INDIAN REFINERY DEMANDS ADVANCE PAYMENT FOLLOWING EU SANCTIONS ANNOUNCED

In the 18th round of sanctions, the EU imposed restrictions on India's second-largest refinery, the European Union's main diesel supplier. Although the sanctions will take effect on January 26 next year, the refinery owner has already begun demanding advance payment for supplies.

"Nayara Energy, partly owned by Rosneft and affected by European Union sanctions, revised the payment terms for the sale of a naphtha cargo at spot prices in a tender announced on Monday," Reuters reported, citing tender documents.

As the agency noted, Nayara Energy requested advance payment or a letter of credit from potential buyers for a naphtha shipment of 33,000-35,000 tons, scheduled for shipment between August 14 and 18.

"The company also announced a tender for the sale of jet fuel, but negotiations dragged on as the company attempted to modify the payment terms," Reuters wrote, citing a trader.

According to the agency, the naphtha shipment was sold at a premium of $2.50-$3 per barrel at FOB (free on board) prices in the Persian Gulf to a major Middle Eastern oil company.

As EADaily reported, the European Union has adopted the 18th package of sanctions against Russia and banned the import of petroleum products derived from Russian oil. However, this decision will not take effect immediately, but in six months. The share of diesel fuel from Russian oil in the EU is too high. Nayara Energy, in which Rosneft holds a 49% stake, has also been placed under restrictions. It owns India's second-largest refinery, with a capacity of 20 million tons per year. The plant is located in Vadinar.

After the EU banned Russian oil imports, except for supplies via the Druzhba pipeline, the region lost its main diesel supplier. India took its place, increasing its oil purchases from Russia to a third of all imports. This allowed both Indian refineries to profit and supply Europe with fuel. Indian diesel supplies to EU countries amount to approximately 20 million tons annually, and India has become the European Union's main supplier, surpassing the United States.