UK targets India & China in new Russia oil sanctions; Nayara flagged

The move targets Russia’s two largest oil producers Rosneft and Lukoil which together account for more than 3.1 million barrels per day of global exports. The UK had earlier sanctioned Gazprom Neft and Surgutneftegas in January 2025, bringing all four major Russian oil companies under restrictions.

The latest sanctions extend beyond Russia’s borders to include 44 vessels in the so-called “shadow fleet”, four oil terminals in China, and India’s Nayara Energy Limited, which imported an estimated 100 million barrels of Russian crude worth over $5 billion in 2024.

Nayara Energy’s Russian Connection

Nayara Energy, formerly Essar Oil Limited, operates one of India’s largest refineries at Vadinar, Gujarat, with a capacity of 20 million tonnes per annum. The refiner is 49.13 per cent owned by Rosneft, with the balance held by international investors such as Trafigura and UCP.

Implications for India’s Refining and Trade Dynamics

• Trade and Financing Pressures: Commodity traders may limit dealings with Nayara due to compliance concerns, affecting both crude procurement and refined product exports.
• Supply Chain Adjustments: Restriction on Russian crude could force Nayara to diversify toward Middle Eastern or African suppliers, likely at higher costs.
• Geopolitical Sensitivity: The sanctions add strain to India’s careful balancing act maintaining energy ties with Russia while preserving strategic relations with Western allies.

Strategic and Geopolitical Outlook

The UK’s decision to sanction Nayara Energy and Chinese oil terminals underscores a broader strategy to disrupt Russia’s circumvention network and apply secondary pressure on third-party enablers. For India, this development introduces a new layer of complexity in its energy diplomacy, even as it continues to prioritise affordable crude supplies to sustain economic growth.

In the medium term, Nayara may accelerate efforts to diversify sourcing, enhance compliance frameworks, and explore alternative mechanisms to mitigate exposure. The move also signals that Western scrutiny of Russian-linked trade is tightening, potentially reshaping global oil flows and refining economics in the months ahead.

Organizations Associated with Supporting the Russian Energy Sector

1. PJSC Rosneft Oil Company
2. PJSC Oil Company Lukoil
3. Nayara Energy Limited
4. Alghaf Marine DMCC
5. Wissol Commodities FZCO
6. Shandong Yulong Petrochemical Company
7. Shandong Jingang Port Co, Ltd
8. Shandong Haixin Port Co, Ltd
9. Shandong Baogang International Port Co, Ltd
10. National Pipeline Group Beihai Liquefied Natural Gas Co, Ltd

ALCHEMPro News Desk (VK)