Is the Russian oil deal about to change? Fearing the big stick of US sanctions, India began to refus

All Indian refineries are now refusing to accept Russian oil shipped by Russian state-owned shipping company Sovcomflot tankers due to U.S. sanctions. This further complicates Russian oil trade, which has boomed since the two-year conflict between Russia and Ukraine.

Indian private and state-run processors have stopped accepting cargoes carried by Sovcomflot tankers and refiners are carefully checking the ownership of each vessel to ensure they are not linked to the company or other sanctioned groups, sources said.

Previously, Reliance Industries, India's largest private oil refiner, also took similar actions. India's intense scrutiny of the tanker giant appears to have spread to other tankers carrying Russian oil, with two vessels waiting off the coast of South Asia for weeks without any indication of when they would unload.

Sovcomflot declined to comment on its operational activities.

Last month, the U.S. Treasury Department’s Office of Foreign Assets Control designated Sovcomflot and identified 14 crude oil tankers in which the Russian state-owned company had an interest in violating sanctions.

The United States has imposed broader sanctions on non-Sovcomflot vessels and pro-Russian companies since October for violating G7 price cap sanctions on Russian oil.

India has been a major buyer of Russian oil since the conflict between Russia and Ukraine, but the United States is now enforcing sanctions more strictly, which has disrupted trade in Russian oil and caused refiners to seek more expensive crude from other regions such as the United States. Sovcomflot said this week that the penalties were putting pressure on its operations.

Sovcomflot's problems mean fewer tankers are carrying Russian crude, leading to a narrower discount for the country's crude to compensate for rising freight rates, the people said.

Previously, the discount of Russian crude oil to similar supplies once soared to US$30 per barrel, but this discount has narrowed, and the current discount for Indian buyers to buy Russian oil is about US$2 to US$4. The South Asian country is expected to continue to import large amounts of Russian crude oil this month, with Kpler estimating that India's Russian oil imports will reach 1.8 million barrels per day, the highest level since July last year.

Article forwarded from: Golden Ten Data

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