Russia Tries to Bypass Sanctions with India's Help

The Indian oil refining company Nayara Energy Ltd., a part of whose shares belongs to the Russian "Rosneft," has begun to recover after European sanctions threw it into crisis. The restrictions imposed two months ago had disrupted trade and forced European executives to leave the company, but thanks to the support of the Indian government and alternative solutions, the company's operations and sales are recovering.

The main reason for the sanctions is the ownership structure of Nayara Energy: the Russian state company "Rosneft" owns 49% of the shares. This connection made Nayara a target of the EU, which led to serious operational difficulties. In particular, the company faced restrictions on access to banking, insurance, and shipping services, and some key software suppliers, such as SAP, discontinued their services. To overcome the crisis, Nayara has resorted to several strategic steps. One of the most important was the transition to payments in the local currency, the rupee.

The company began to cooperate with major Indian banks, including the State Bank of India, to make payments for Russian oil in rupees. In addition, the company has reoriented its export destinations and has activated fuel sales in the domestic market through its network of more than 6,500 gas stations. Previously relying mainly on oil imported from Saudi Arabia and Iraq, the plant now operates mainly on Russian Urals crude.

Despite the recovery of operations, challenges still remain. Access to international banking services is limited, and Saudi Arabia and Iraq have not yet resumed oil supplies due to concerns about sanctions. Nevertheless, Nayara Energy is actively negotiating with these countries to resume supplies.