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Bloomberg: Russian oil trade feels pressure of Western sanctions in India

by Martin Fornusek and The Kyiv Independent news desk March 23, 2024 9:07 PM 2 min read
The Russian oil tanker Crius waits for a cargo of oil in Ceuta, Spain, on March 5, 2023.
The Russian oil tanker Crius waits for a cargo of oil in Ceuta, Spain, on March 5, 2023. (Antonio Sempere/Europa Press via Getty Images)
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Russia's oil trade is starting to feel the pressure of Western sanctions as Indian refineries no longer accept tankers of Moscow's state-owned Sovcomflot shipping company, Bloomberg reported on March 23.

Following the sanctions imposed against Russia over its invasion of Ukraine, Moscow has been seeking new markets for its fossil fuels. India has become a key buyer of Russian oil, second only to China.

Multiple tankers carrying Russian crude have been unable to land in Indian ports in recent months in connection to sanctions. According to Bloomberg, dozens of sanctioned vessels are now idling by in numbers not seen since 2017.

The U.S. has been tightening its restrictions against Russian oil since last October, sanctioning around 40 oil tankers involved in the trade. Russia's largest shipping company, Sovcomflot, came under fresh sanctions in February for violating the $60-per-barrel price cap.

Towards the end of 2023, Group of Seven (G7) countries vowed to step up enforcement of the price cap, first implemented in December 2022, after reports emerged that Russia has continued to ship out much of its crude above $60 per barrel by using a "ghost fleet" of mostly uninsured tankers.

Sovcomflot transported around one-fifth of all Russian crude deliveries to India in 2023, Bloomberg noted.

Rising challenges to Russia's oil industry, one of Moscow's key revenue sources, are compounded by Ukraine's drone attacks against the country's refineries. The U.K. Defense Ministry said that the drone strikes may have disrupted at least 10% of the country's refinery capacity.

Russia’s war effort may not be as formidable as it looks
Russia’s war machine has shown remarkable stamina despite the hundreds of thousands of troops it is estimated to have lost in Ukraine. But under the hood, it may be less resilient than it looks. With its high oil export revenues, Russia has been able to replace its losses and
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8:28 PM

FT: Russia may be gearing up for large-scale offensive against Ukraine.

Russian forces may be preparing for a large-scale offensive in late spring or summer, aiming to capture more land in Ukraine's partially-occupied Donetsk, Kherson, Luhansk and Zaporizhzhia oblasts, the Financial Times reported on April 13, citing unnamed Ukrainian and Western officials.
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