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Petroleum

Reliance Industries Ltd Abides by Western Sanctions on Russian Oil

Strategic Insights

— 2 min read

Reliance Industries Ltd, India's top importer of Russian oil, has stated that it will comply with Western sanctions targeting Russia's two largest oil companies. The conglomerate, chaired by billionaire businessman Mukesh Ambani, announced that it will adapt its refinery operations to meet the compliance requirements of the sanctions. This decision comes after the United States Treasury Office of Foreign Assets Control (OFAC) designated Russian majors Rosneft and Lukoil, and the European Union adopted its 19th package of measures against Russia, including a full transaction ban on Rosneft.

Reliance, which operates the world's biggest refining complex in western Gujarat, has purchased roughly half of the 1.7-1.8 million barrels per day of discounted Russian crude shipped to India. The company has a 10-year deal with Rosneft to buy nearly 500,000 barrels per day, and also buys Russian oil from intermediaries. Despite the uncertainty surrounding the sanctions, Reliance emphasized its confidence in its diversified crude sourcing strategy, which will continue to ensure stability and reliability in its refinery operations.

Key Takeaways:

  • Reliance Industries Ltd will abide by Western sanctions targeting Russia's two largest oil companies, Rosneft and Lukoil.
  • The conglomerate will adapt its refinery operations to meet the compliance requirements of the sanctions.
  • Reliance has purchased roughly half of the 1.7-1.8 million barrels per day of discounted Russian crude shipped to India.
  • The company has a 10-year deal with Rosneft to buy nearly 500,000 barrels per day.
  • Reliance buys Russian oil from intermediaries, in addition to its deal with Rosneft.
  • The sanctions also arrive as India navigates the fallout from Trump's tariffs on Indian exports, which rose to 50 percent starting in August as a penalty for importing Russian oil.
  • China and India are the world's largest importers of Russian crude.

Statistics:

  • Reliance Industries Ltd has purchased roughly half of the 1.7-1.8 million barrels per day of discounted Russian crude shipped to India.
  • The company has a 10-year deal with Rosneft to buy nearly 500,000 barrels per day.
  • The sanctions target Russia's two largest oil companies, Rosneft and Lukoil.
  • The European Union has previously said that, starting January 21, it will not receive fuel imports from refineries that received or processed Russian oil 60 days prior to shipping.

Sources:

  • Al Jazeera: "Will Trump's sanctions against Russian oil giants hurt Putin?"
  • Reuters: "Reliance Industries signs 10-year deal with Rosneft to buy Russian oil"
  • Al Jazeera: "Inside Story: Is Trump losing patience with Putin over the Ukraine war?"
  • Al Jazeera: "Trump imposes 25 percent tariff on Indian goods over Russian oil"
  • Al Jazeera: "Can Trump force India to give up buying Russian oil?"

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