At least two vessels carrying Russian crude oil destined for India have diverted routes following new US sanctions targeting over 115 Iran-linked entities and ships involved in Russian oil transport. The Tagor, initially bound for Chennai, redirected to Dalian, China, while the Tassos altered course to Port Said, Egypt. A third sanctioned vessel, the Guanyin, maintained its path toward Sikka port, used by Reliance Industries and Bharat Petroleum though Reliance denied accepting its cargo. These disruptions stem from tightened Western sanctions aimed at curbing Russia’s oil revenue, which funds its war in Ukraine.
President Trump’s threat of 100% tariffs on Russian oil buyers unless Moscow agrees to a Ukraine peace deal by August 8 has intensified pressure on India, which relies on Russia for 35% of its oil imports (1.75 million barrels daily). Despite this, Indian officials affirmed long-term contracts with Russia would continue, citing the impracticality of abrupt termination. Foreign Ministry spokesperson Randhir Jaiswal emphasized India’s energy decisions prioritize "market dynamics," not external demands.
The sanctions have hit India’s refining sector unevenly. State refiners (Indian Oil, Hindustan Petroleum, Bharat Petroleum) paused new spot purchases due to narrowed Russian discounts, opting for pricier Middle Eastern and West African crude. Private players like Reliance Industries and Rosneft-backed Nayara Energy continue imports via sanctioned vessels (e.g., Achilles and Elyte), leveraging annual contracts. Nayara’s CEO resigned after EU sanctions disrupted shipments, highlighting operational chaos. The EU’s latest sanctions now prohibit third-country refined Russian oil products, forcing Indian diesel exports to seek Asian and African markets instead of Europe.
Despite disruptions, Russia retains buyers like China, which absorbed the Tagor’s diverted cargo. Analysts note India and China’s use of shadow fleets and supply-chain workarounds to mitigate sanctions, underscoring the limitations of Western enforcement. As Russian Urals crude trades at a $12–$15/barrel discount, India’s import pause remains tactical, not strategic.