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Nayara generally imports around 2mbbl of crude oil from Iraq and a further 1mbbl from Saudi Arabia each month. Credit: T. Schneider/Shutterstock.com.
Saudi Arabia-based Aramco and Iraq’s SOMO have ceased selling crude oil to Nayara Energy in the wake of EU sanctions on the Indian refiner, as reported by Reuters, citing three sources with knowledge of the matter.
Nayara, which is majority-owned by Russian entities including Rosneft, currently depends entirely on Russian crude, according to sources.
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The Indian refiner, which generally imports around two million barrels (mbbl) of crude oil from Iraq and a further 1mbbl from Saudi Arabia on a monthly basis, did not receive shipments from either supplier in August.
The sanctions have reportedly led to payment issues for Nayara’s purchases from SOMO, although details remain sparse.
SOMO and Nayara have not commented on the matter, while Saudi Aramco declined to comment.
The last cargo of Basra crude from SOMO was delivered to Nayara on 29 July by the very large crude carrier (VLCC) Kalliopi at Vadinar port.
Similarly, Nayara’s final consignment of Saudi oil arrived on 18 July, carried by the VLCC Georgios, comprising 1mbbl of Arab Light.
Since then, the company has been dependent on direct supplies from Rosneft, as confirmed by an official from the Russian Embassy in New Delhi, India.
Operating its 400,000 barrels per day refinery in Vadinar, western India, at around 70–80% capacity, Nayara faces challenges selling its products due to the sanctions.
The company, which controls roughly 8% of India’s 5.2mbbl per day refining capacity, relied on ‘dark fleet’ vessels for transportation after other shippers withdrew their services.
Amidst these operational difficulties, Nayara Energy’s CEO resigned in July.
The company recently announced the appointment of a senior executive from Azerbaijan-based SOCAR, an oil company, as its new chief executive.
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