Microsoft Ditches Russia-Linked Nayara: EU Sanctions Slam Indian Oil Giant Into Crisis, Rediff Rushed In | World News

New Delhi: A storm is brewing in India’s oil sector. The trigger? A fresh wave of European Union (E.U.) sanctions aimed at isolating Russia’s oil economy. But this time, the fallout is not in Moscow; it is at a high-capacity refinery in Gujarat, where Nayara Energy, backed by Russian oil giant Rosneft, is suddenly cut off from its digital backbone.

Microsoft has abruptly suspended its services to Nayara, leaving thousands of employees locked out of their familiar digital workspace. No Outlook. No Teams. No warning.

By Tuesday last week, the shutdown was complete, according to sources quoted by Reuters. The sanctions had found their latest and most unexpected target.

To keep communication going, Nayara scrambled for a backup. The company turned to Rediff.com, an old Indian internet brand now offering enterprise email services. Based in Mumbai, Rediff has stepped in to provide an internal messaging system. But there is a catch. It cannot touch any of the data previously stored on Microsoft’s cloud. As a result, years of archives gone dark for now.

Caught off guard, Nayara on Monday dragged Microsoft to the Delhi High Court, challenging what it calls a “unilateral” and “legally unjustified” decision. The refinery is pushing back, not only in court, but in public.

“This action has been taken unilaterally, without prior notice, consultation or recourse and under the guise of compliance. Such moves signal a worrying trend of global corporations extending foreign legal frameworks into jurisdictions where they have no applicability,” Nayara said in a statement.

Microsoft is headquartered in the United States. The E.U. sanctions, Nayara pointed out, apply only in Europe, not in America or India. Still, the tech giant chose to pull out.

And this is where things get messier.

Capable of processing 20 million tonnes a year, Nayara’s Vadinar refinery is one of India’s top importers of Russian crude. It handles about 8% of India’s refining output and fuels nearly 7% of the national retail network with over 6,750 filling stations. The company is also expanding into petrochemicals, aiming for 8% of India’s polypropylene capacity.

Until now, Nayara had been seen as a key player helping India balance its energy needs with discounted Russian oil, especially after the war in Ukraine began.

But things are shifting. Bloomberg reports say oil firms and shippers are beginning to keep their distance. Exporting refined products or importing crude has started becoming more complicated.

Nayara has become the first Indian oil company directly impacted by the EU’s newest sanctions.

The refinery insists it follows Indian law to the letter. “We remain in continuous dialogue with Indian authorities to ensure complete transparency and accountability,” the company stated.

New Delhi is not happy either.

India has pushed back against what it calls unilateral restrictions. Responding to the latest sanctions, the Ministry of External Affairs did not mince words.

“India does not subscribe to any unilateral sanction measures. The Government of India considers the provision of energy security a paramount importance to meet the basic needs of its citizens. We would stress that there should be no double standards, especially when it comes to energy trade,” said MEA spokesperson Randhir Jaiswal.

On July 19, the E.U. tightened the price cap on Russian oil from $60 to $46.7 per barrel, squeezing already thin margins. The ripple effects are now being felt in Indian boardrooms and courtrooms alike.

What happens next could redefine how India’s energy partnerships evolve and how far corporate compliance with foreign sanctions can go, even within sovereign borders.

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