Russian Sanctions Ineffective... "Russian Crude Oil Exported to Various Countries via India"

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Kim Hyunjung] It has been revealed that Russian crude oil is being exported to Europe and other countries around the world through India. Avoiding Western economic sanctions, Russia and India are each securing export payments and refining profits, while importing countries end up paying higher prices.

The Wall Street Journal (WSJ) reported on the 1st (local time) that Russian crude oil is being exported worldwide through Indian companies, employing maritime transshipment methods as well.

According to the Finnish think tank 'Energy and Clean Air Research Centre,' financial information firm Refinitiv, and shipping records, Russian crude oil with obscured origin is distributed as refined products such as gasoline and diesel through Indian refineries. Since the Ukraine invasion, energy embargoes and other sanctions imposed by the West, including the United States and the European Union (EU), have been virtually ineffective. The Journal pointed out that these sanction evasion methods began even before the EU's recent sanction announcement, potentially undermining the sanctions' effectiveness.

India has recently significantly increased its imports of Russian crude oil compared to before the Ukraine war. While it was about 30,000 barrels per day just before the war, it has recently surged to 800,000 barrels per day. The Journal analyzed that this is because Russian Urals crude is priced about $35 cheaper per barrel than Brent crude. In particular, Indian energy company Reliance Industries purchased seven times more Russian crude last month than before the war. A tanker chartered by Reliance was confirmed to have departed from the port of Sikka on April 21 without a pre-planned destination, carrying alkylate, a gasoline component, and unloaded its cargo in New York, USA, on May 22.

Laurie Myllyvirta, senior analyst at the Energy and Clean Air Research Centre, told WSJ, "It appears that Reliance took discounted Russian crude cargo, refined it, and sold the products in a short-term market where buyers in the United States could be found."

Since the Ukraine war, exports of Indian refined products to Europe increased by 33%, and exports to the United States increased by 43% compared to the previous quarter. Maritime transshipment methods, mainly used by countries under international sanctions such as Iran, Venezuela, and North Korea, seem to have been utilized in this process. The Journal reported that last week, a tanker named 'Zen 1' carrying Russian crude oil was estimated to have transferred oil at sea with the ultra-large tanker 'Lauren 2' off the coast of West Africa. Experts diagnosed that Lauren 2 then headed to China via Gibraltar.

Israel's ship data company Windward viewed the sharp increase in cases where ships turn off their GPS devices that indicate their location while sailing as suspicious. The Journal reported that Chinese buyers purchasing Russian crude oil try to hide the fact that the products are Russian oil to avoid high transportation and insurance costs resulting from international sanctions and companies' voluntary 'anti-Russia' measures.

This content was produced with the assistance of AI translation services.