India to Cut Off Russian Oil Imports to Avoid US Sanctions

Written by Camilla Jessen

Mar.25 - 2024 11:01 AM CET

India's refineries plan to stop accepting Russian oil from Sovcomflot to avoid facing US sanctions.

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India's refineries, the second-largest buyer of Russian oil since the invasion of Ukraine, will no longer accept deliveries from the Russian state-owned company Sovcomflot following recent sanctions imposed by the United States against Moscow, reports Bloomberg.

According to the source, this decision will gradually lead to a decline in the Kremlin's oil revenues.

The Indian refineries seek to avoid dealing with entities that are directly or indirectly sanctioned and aim to prevent any backlash from Washington.

This decision is expected to compound the challenges Russia faces in its oil exports, as its oil firms may struggle to find ships to sell their surplus oil following recent Ukrainian drone attacks on Russian refineries, according to Reuters.

Since last October, the United States has imposed a series of sanctions against entities, shippers, traders, and vessels for breaching a price cap on Russian oil, Bloomberg reports.

Despite the sanctions, Russia has continued to export large quantities of oil.

Russia can still resort to the so-called "shadow fleet" of older, uninsured ships to export crude oil and circumvent international sanctions. According to estimates, there are about 600 such ships, accounting for approximately 10% of the global number of large oil tankers.