Indian Oil will continue to purchase Russian crude from non-sanctioned entities: official ones
Indian Oil Corp. will continue to buy Russian crude but only from non-sanctioned entities, the company’s chief financial officer said on October 28, adding that this would help the state-run refinery meet US and EU sanctions obligations.
“Russian crude oil is not affected by sanctions. What is affected by sanctions are the entities and shipping companies. Today, if someone comes to me with an entity that is not affected by sanctions, and the limits are being adhered to, and the delivery is fine, then I will continue to buy it,” said Anuj Jain when contacted by investors.
“We will absolutely not stop as long as we comply with the sanctions,” he added.
His comments came after IOC Chairman Arvinder Singh Sahney told Platts, part of S&P Global Commodity Insights, that his company would strictly follow all international sanctions requirements as required when planning its future oil imports or exports.
The US imposed sanctions on Rosneft and Lukoil on October 22. The following day, the EU imposed a comprehensive transaction ban on Rosneft and Gazprom Neft, alongside sanctions targeting Lukoil subsidiary Litasco and the trading division of PetroChina, China’s largest energy company. The Indian government has not officially responded to the latest sanctions.
Roadmap
Petroleum and Natural Gas Minister Hardeep Singh Puri said on October 28 that India is not worried about crude oil availability, as global supply is sufficient to meet future growth in domestic consumption and demand for exports of oil products.
India’s overall crude oil imports from Russia, its largest supplier, averaged 1.75 million barrels per day during January-September, according to data from S&P Global Commodities at Sea(opens in a new tab).
S&P Global said in a research note dated October 28 that new US sanctions on Russian oil companies will further complicate ongoing purchases by Indian companies. India’s compliance with US sanctions is generally high, and the government would likely seek to negotiate sanctions waivers rather than violate sanctions and risk facing secondary sanctions.
“However, if non-sanctioned Russian entities are used as a conduit to sell Russian oil to India at the discounted prices that India has obtained so far, purchases from India will continue, unless President Trump specifically states that a broader trade deal with India is inconceivable unless India completely halts imports of Russian oil, which appears unlikely,” the research note said.
Source: Platts
