Impact of EU Sanctions: Navigating Challenges for Nayara Energy

Indian ship owners have requested Nayara Energy, which is backed by Russia, to terminate contracts for three vessels due to recent EU sanctions. The sanctions, affecting operations of Nayara's major refinery, have led to challenges in exporting and storing refined-fuel stocks at its facilities.

The Indian owners of three vessels chartered to Nayara Energy have requested the Russian-backed company to end their contracts following the enactment of recent European Union sanctions on the refiner, according to six sources on Tuesday.

Seven Islands Shipping Ltd and Great Eastern Shipping Co (GESCO), based in India, have asked Nayara to release the three medium-range tankers, Bourbon, Courage, and Jag Pooja, over concerns about the sanctions. The sources, seeking anonymity, cited unauthorized media disclosure. No immediate commentary was available from Nayara, Seven Islands, or GESCO.

The shortages in ship access hinder Nayara's capacity to sell its refining output, impacting operations at its 400,000 barrels-per-day refinery. Reuters noted that EU sanctions from July 18 restrict operations due to storage limits. Nayara holds 8% of India's refining capacity and operates over 6,000 fuel stations.

(With inputs from agencies.)