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Bloomberg: EU sanctions squeeze Rosneft’s Indian refiner — buyers now forced to pay in advance

Par :Yuri Zoria

eu sanctions squeeze rosneft’s indian indian refinery mumbai russian allies refiner — buyers now forced pay advance nayara's refinery nayara energy rosneft-linked oil payment rules changed after bloomberg reports mumbai-based part-owned rosneft demands upfront documentary

Rosneft-linked oil payment rules changed after EU sanctions, Bloomberg reports. Mumbai-based Nayara Energy, the Indian refinery part-owned by Rosneft, now demands upfront payment or documentary letters of credit from buyers, showing how far-reaching the latest EU sanctions package is.

The change comes in direct response to the European Union’s latest round of sanctions targeting Russian-linked energy trade. These measures include a stricter price cap on Russian crude, curbs on products derived from Russian petroleum, and restrictions on affiliated banks and shipping. Though Nayara had previously avoided direct sanctions, the new EU package now targets the company more explicitly.

Nayara tightens oil deal terms after new EU measures

Nayara Energy Ltd., a key Indian refinery partially owned by Russia’s Rosneft, is now requiring advance payments or documentary letters of credit for upcoming oil shipments. According to Bloomberg, the shift was revealed in a revised tender document for a naphtha cargo scheduled for next month. The previous version of the tender included no such financial requirements. Naphtha is a fraction of crude oil, used for further petrochemical production.

Kpler analyst Zameer Yusof told Bloomberg the move “underscores how far-reaching the latest tranche of EU sanctions are.” He said the advance payment condition likely reflects fears that buyers may back out of deals or that banks could refuse to clear transactions involving sanctioned entities. 

In a weekend statement, Rosneft claimed that the EU’s new measures as “unjustified and illegal.” Meanwhile, Nayara insisted that operations remain normal and said it is “exploring all legal and appropriate avenues” to respond to the situation.

India’s role in Russian crude trade under pressure

India has become one of the largest importers of Russian crude since Moscow launched its full-scale invasion of Ukraine in 2022. As Western buyers turned away, Indian refiners stepped in to process Russian oil, including into diesel and other products that were then exported globally. Until now, Nayara had continued those operations without direct interference from sanctions.

The EU, UK, and US have issued multiple waves of restrictions targeting Russia’s energy sector in hopes of undercutting funding for the war.
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