In recent months, three oil tankers recently sanctioned by the US shipped Sokol crude oil from Russia’s Far East to the biggest oil refiner in India.
According to ship tracking data from LSEG and Kpler, the Kazan, Ligovsky Prospect and NS Century discharged Sokol crude to Indian Oil Corp in September. Two of the ships also made the trip to India in September.
On Thursday, Washington placed sanctions on the three vessels for transporting Russian oil above the price cap. The price cap was introduced in 2022 and bars Western companies from buying, insuring or transporting Russian crude above $60 per barrel.
Deputy Secretary of the Treasury Wally Adeyemo said: “Shipping companies and vessels participating in the Russian oil trade while using Price Cap Coalition service providers should fully understand that we will hold them accountable for compliance.”
Several traders who wished to remain anonymous told Reuters that the sanctions may hinder the shipping of Russian oil in the short term, but they are unlikely to stop it altogether as long as trade in Russian oil remains lucrative.
Another trader said that India may turn to the Mediterranean and the North Sea to replace Russian Sokol.
How well do you really know your competitors?
Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.
Your download email will arrive shortly
Not ready to buy yet? Download a free sample
We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below formBy GlobalData
India has sought to make the most of discounted Russian oil since the beginning of the war in Ukraine when Western nations stopped buying from Moscow. In the first half of the 2023/24 fiscal year, overall imports rose by around two-fifths, and Russia was the top oil supplier to India from April to September.
On India’s geopolitical relationship with Russia, Felix K Chang, senior fellow at the Foreign Policy Research Institute, said: “It (India) sharply boosted its purchases of Russian commodities, from fertilizer to steel. Most notably, India went from being a negligible importer of Russian oil in 2021 to being the biggest in 2022.”