India’s private refiner Nayara Energy has seen a sharp disruption in its oil supplies after two of its biggest partners, Saudi Aramco and Iraq’s state-owned SOMO, stopped sending crude shipments. The halt follows European Union sanctions introduced in July that directly impact Nayara because it is majority-owned by Russian groups, including energy major Rosneft.
Nayara Energy is India’s second-largest private oil refiner and runs the country’s most important coastal refinery at Vadinar in Gujarat. It plays a key role in meeting India’s fuel demand and also exports gasoline and diesel to overseas markets. The company was earlier known as Essar Oil before being acquired by a consortium led by Rosneft.
For years, Nayara has been one of the largest buyers of Middle Eastern crude. Every month, it usually secures around 2 million barrels from Iraq and about 1 million barrels from Saudi Arabia. These volumes have been key to running its giant refinery in Vadinar, located in western India. But in August, industry trackers and shipping data from Kpler and LSEG revealed that no tankers from Saudi Arabia or Iraq arrived at Nayara’s port.
The last Iraqi shipment of Basra crude was offloaded on July 29 at Vadinar port by the vessel VLCC Kalliopi, while the final Saudi delivery of Arab Light was received on July 18 aboard the VLCC Georgios. This sudden halt has left Nayara with only one option—depending entirely on Russian crude oil. Sources in the industry said this shift is unusual and has added stress to Nayara’s supply chain.
EU Sanctions Create Payment Trouble
The European Union’s new sanctions appear to have created a financial roadblock for Nayara. According to industry insiders, the company faced difficulties making payments for its purchases from Iraq’s SOMO. While the exact details remain undisclosed, the outcome has been clear: neither Iraq nor Saudi Aramco delivered oil to Nayara after the sanctions were enforced.
The EU sanctions were part of a broader package aimed at restricting businesses linked to Russia’s energy sector. These measures include tighter banking restrictions, trade limits, and compliance checks that make it difficult for companies tied to Russian ownership to settle transactions with global suppliers. Even if oil itself is not directly banned, the financial restrictions can block deals by disrupting payments and insurance.
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In the absence of these regular Middle Eastern supplies, Nayara’s imports dropped dramatically. Ship-tracking platforms Kpler and LSEG confirmed that in August, the company brought in only about 94,000 barrels of crude per day. This marks a huge fall compared to nearly 366,000 barrels per day during the same month last year.
The company’s connection with Rosneft is at the center of this shift. Since the sanctions took effect, Nayara has been sourcing its crude directly from the Russian producer. This reliance on Rosneft is now the only lifeline keeping Nayara’s operations running.
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Refinery Operations Under Pressure
Nayara Energy runs one of India’s biggest refineries, with the capacity to process 400,000 barrels of crude every day. Located in Vadinar on India’s western coast, this facility is a major player in the country’s fuel supply. But with crude imports now limited, its operations have come under heavy pressure.
Industry sources report that the refinery is working at only 70 to 80 percent of its full potential. This reduced run is tied to both the loss of Middle Eastern supplies and the complications caused by sanctions when it comes to selling refined products in international markets.
The disruption is particularly significant because Nayara has historically balanced its crude mix between Middle Eastern grades and Russian oil. Losing access to steady shipments from Saudi Aramco and SOMO has not only affected daily imports but has also created one of the lowest crude intake levels in the company’s history.
This sudden drop has raised concerns across the energy market. Nayara’s situation shows how geopolitical moves such as sanctions can ripple far beyond borders, directly affecting companies, supply chains, and refining activity in countries like India.