India will reject Russian oil tankers under US sanctions, Bloomberg reports

Oleksii Artemchuk — Monday, 13 January 2025, 16:02
An oil tanker. Photo: Getty Images

India intends to abandon oil tankers that have been sanctioned by the United States because of their role in transporting goods for Russia, which is another example of the impact of Washington's measures on the global oil market.

Source: Bloomberg

Details: A senior Indian official told reporters that the sanctioned vessels will not be allowed to unload.

This does not apply to vessels chartered before 10 January, provided they are unloaded by 12 March.

The official, who asked not to be named because of the sensitivity of the issue, also said that the effects of the sanctions would be felt in two months:

  • Oil supply is not a problem. The Organisation of the Petroleum Exporting Countries
  • has 3 million barrels a day of spare capacity, and non-OPEC suppliers such as the US, Canada, Brazil and Guyana can easily supply more barrels.
  • Indian refiners are negotiating term deals with suppliers from the Middle East. Depending on the market situation, they may look for additional barrels.
  • Indian refiners may lose the discounts they have been enjoying on Russian crude if supplies become scarce.
  • Russia will find ways to deliver its barrels to India.
  • Indian banks will require certificates of origin to ensure that oil does not come from sanctioned suppliers.

Background:

  • Three tankers with more than 2 million barrels of Russian oil are floating in the waters off eastern China and cannot be shipped after the US imposed new sanctions on Russia's largest oil companies on Friday, 10 January.
  • The US Treasury Department's Office of Foreign Assets Control has imposed sanctions on two of Russia's largest oil companies, Gazprom Neft and Surgutneftegas, as well as ship insurance providers Ingosstrakh and AlfaStrakhovanie.
  • According to the Financial Times, the measures include the blacklisting of 183 ships of the "shadow fleet" involved in exports from Russia.

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