The European Union has introduced a powerful new wave of sanctions that could drastically reshape how diesel is traded around the world. This 18th package of sanctions targets refined fuels made from Russian crude oil, even if the refining happens in third countries like India or China. The aim is to cut off one of the last remaining routes through which Russian oil has been reaching Europe indirectly since the war in Ukraine began.
The move marks one of the most serious efforts yet to block Moscow’s oil revenues. It closes a key loophole that allowed countries to refine cheap Russian oil and sell the end products—like diesel—back to Europe. Now, the EU wants to ensure that not just Russian fuel, but even fuel made from Russian crude, stays out of its borders.
India, China, and Turkey Caught in the Crossfire
India is expected to be among the hardest hit by this new rule. Its refineries, including Reliance Industries’ massive 1.2 million-barrel-per-day complex in Jamnagar, have become major suppliers of diesel to Europe. In fact, Indian refiners provided around 16% of Europe’s diesel and jet fuel imports last year.
But a large part of India’s oil feedstock comes from Russia. In 2024, about 38% of the crude oil imported into India originated from Russian sources, according to energy analytics firm Kpler. That means a significant portion of the diesel that India exports to Europe could soon be blocked under the new EU restrictions.
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China, another key buyer of Russian crude, has also been exporting fuel to Europe. However, it may face fewer disruptions than India due to lower export volumes and diversified trading strategies.
Turkey’s situation is slightly different. Although Turkey also imports Russian oil, most of it is used domestically. Refineries that do export diesel to Europe often use non-Russian crude, meaning they may avoid major setbacks under the new EU rules.
Gulf Nations Poised to Fill the Gap
As Europe moves to cut off diesel made from Russian oil, countries in the Middle East are preparing to expand their role in the fuel trade. Refineries in Saudi Arabia, the United Arab Emirates (UAE), and Kuwait are well-positioned to benefit. These countries are net exporters of crude oil, and under the EU’s new rules, they are allowed to continue selling diesel to Europe—even if they also buy Russian crude for domestic use.
This gives Middle Eastern suppliers a key advantage. With fewer restrictions and strong refining capabilities, they are expected to take over a large part of the market share currently held by India and China.
As the Gulf states ramp up their exports, fuel flows will shift significantly. More diesel will travel from the Middle East to Europe, while Asian producers will be forced to reroute their shipments to other regions.
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Global Diesel Routes Set for Major Overhaul
The ripple effect of the EU sanctions will be felt far beyond Europe. As Indian refiners lose access to their top export market, they will need to look elsewhere. One likely destination is Africa, where fuel demand is rising. But they will face stiff competition from Nigeria’s new Dangote refinery, which has a capacity of 650,000 barrels per day and aims to supply both local and regional markets.
At the same time, European fuel buyers will increasingly turn to the Middle East. These longer supply chains mean more fuel will need to be shipped over greater distances, changing established shipping patterns and increasing costs.
The EU’s updated sanctions represent a major turning point for global diesel trade. As the rules tighten, countries and companies around the world are being forced to rethink where they send and receive fuel—ushering in a complex and uncertain new chapter for the global energy market.