Bloomberg: Indian government helps Rosneft's local refinery circumvent EU sanctions

The Indian oil refinery Nayara Energy, co-owned by Rosneft, is gradually resuming operations after the EU sanctions were imposed on it. About writes Bloomberg, citing informed sources.

The EU sanctions imposed two months ago led to a sharp outflow of European top managers from the company, the disruption of contracts and Nayara Energy's problems with banking operations.

According to the agency, the company has now managed to find workarounds thanks to direct support from the Indian government.

Bloomberg's sources said that Nayara Energy makes payments in local currency through banks, including State Bank of India and UCO Bank, which has received government permission to conduct foreign operations.

As the company's operations return to normal, it is rebuilding its export network with the help of a floating storage facility and a fleet of vessels, including those subject to sanctions.

Nayara Energy's plant in Vadinar is also returning to normal: the company is operating at 75% of its capacity and increasing its output.

According to the agency's sources, it used to use a mixture of Saudi, Iraqi, and Russian oil, and now has almost entirely switched to Russian Urals with an admixture of Indian crude.

At the same time, the company's export volumes remain well below pre-war levels, with about 2.2 million barrels expected in September, half the amount of the same period last year.

Some of the cargo is transported by tankers that were previously associated with the so-called "shadow fleet" of Russia.

Domestic demand for fuel has so far saved the company from more serious problems, but the key factor was government intervention.

• In August, it was reported that due to the EU sanctions, Nayara Energy would suffer difficulties with fuel transportation.
• Company changed the terms of tenders and now requires prepayment or a letter of credit for the sale of petroleum products. The company's CEO resignedand the largest state-owned bank in India ceased foreign operations of Nayara Energy due to the risk of sanctions.