Indian firms see a major disruption of Russian oil supplies as Washington imposes new sanctions to curb Moscow’s revenues, pushing refiners to scout for crude from the Middle East and the US. The new US sanctions would target more than 180 tankers shipping Russian oil and Russia-based maritime insurance service providers Ingosstrakh Insurance Company and Alfastrakhovanie Group. The United States will impose some of the harshest sanctions yet on Russia’s oil industry, according to a purported US Treasury document circulating among traders in Europe and Asia that drove global oil prices 3 percent higher.
Some 180 vessels, dozens of traders, two major oil companies, and some top Russian oil executives are designated in the sanctions, reports of which pushed global oil prices to close to $80 per barrel. The sanctions, imposed on Russia for its war in Ukraine, would cause severe disruption to Russian oil exports to its major buyers, India and China.
Washington will impose sanctions on two oil majors, Gazprom Neft and Surgutneftegaz, and ship insurance providers Ingosstrakh and Alfastrakhovanie that cover most of the ships supplying Russian oil to India, Moscow’s biggest oil buyer, the document showed. Russia has diverted oil and fuel shipments from Europe to Asia after the start of the war in Ukraine in 2022 after the West imposed harsh sanctions on its energy industry, which provides every tenth barrel of global oil production. Russian companies have adapted by buying their own fleet of tankers and insuring them inside Russia rather than via Western ship insurance.
Until now, hundreds of ships and many Russian oil traders have escaped the harshest US sanctions as the Biden administration sought to strike a balance between the case for tighter sanctions and averting a global oil price rally. President-elect Donald Trump, who takes office later this month, has promised to stop the war in Ukraine, a task that could be helped by harsher sanctions on Moscow, which depends on oil exports to sustain its economy and fund the conflict. Indian refiners will refrain from taking Russian oil in tankers under sanctions or in ships insured by Russian insurers that are under sanctions.
