**EU Sanctions Could Disrupt Rosneft’s Indian Refinery Sale**
The European Union has approved a new package of sanctions against Russia, aimed at increasing economic pressure on the country as it continues its aggression against Ukraine. The measures target Russia’s oil, financial, and defense sectors, and could have significant implications for Russia’s state-controlled oil giant, Rosneft.
**Rosneft’s Indian Refinery in Crosshairs**
One of the key targets of the new sanctions is Rosneft’s 49.13% stake in Nayara Energy Ltd., an Indian refinery that owns nearly 7,000 fuel stations across India. The refinery processes 400,000 barrels per day, making it a major player in the global oil market. India has become one of the largest buyers of Russian seaborne crude, importing about 80% of Russian Urals oil.
**Impact on Rosneft’s Plans**
Rosneft had been in talks with rival refiner Reliance Industries about selling its stake in Nayara, but the new sanctions could make such a deal risky for the company. Since Reliance exports fuels to Europe, it may not be able to avoid the consequences of the EU sanctions. The Russian company has also held talks with several other potential buyers, including Saudi Aramco.
**Background on Rosneft’s Indian Venture**
Rosneft acquired Nayara from the Essar Group in 2017 for $12.9 billion, alongside partners. However, the company has struggled to bring profits back home due to sanctions, and has been seeking to exit its Indian venture. The ownership of Nayara is currently split between Rosneft and an investment consortium, with remaining shares held by retail investors.
**Commentary**
The new EU sanctions are a significant blow to Russia’s oil industry, which has become increasingly reliant on Indian refineries for exports. The disruption to Rosneft’s plans to sell its stake in Nayara Energy Ltd. is just one example of the far-reaching impact of these measures. As the global economy continues to grapple with the consequences of the Ukraine conflict, it remains to be seen how these sanctions will affect the oil market and the companies that operate within it.
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