HPCL-Mittal Energy suspends Russian oil imports; says won’t know if some Russian oil deliveries passed through sanctioned tankers

HMEL’s statement came in response to a Financial Times report, which said that between July and September, the refiner received at least four Russian crude oil shipments that had the involvement of vessels which were sanctioned by the US. The report said that the oil in question was transported on US-blacklisted vessels from the Russia’s Arctic port of Murmansk to the Gulf of Oman, where a non-sanctioned oil tanker—Samadha—took the oil from the sanctioned tankers through a ship-to-ship (STS) transfer, and discharged the volumes at the Mundra port in Gujarat for HMEL’s refinery in Punjab’s Bathinda.

“All transactions and acceptances of shipping deliveries by HMEL are subject to due-diligence and compliance procedures. This includes counterparty KYC, sanctions screening, vessel history and prior port-clearance. Cargo is supplied to HMEL on a delivered-at-port basis. That means the company will not be aware of the details of other ships that crude may have been transported on, nor any attempts by those ships to conceal their position to pick up crude from sanctioned vessels. The ship (Samadha) that delivered the crude to the port in India was not under OFAC sanctions at the time of delivery,” HMEL said.

OFAC—Office of Foreign Assets Control—of the US Department of the Treasury administers and enforces economic and trade sanctions imposed by Washington.

“HMEL’s business activity is in-line with the Indian government and energy security policy. HMEL’s refined output principally serves India’s energy market needs alone with no exports to EU, UK and USA. Notwithstanding this, HMEL had already taken the decision to suspend further purchases of Russian crude upon recent announcements of new restrictions on imports of crude oil from Russia by the United States, European Union and United Kingdom, pending receipt of any outstanding orders. HMEL will continue to review its position and comply with government policy and applicable laws,” the Indian refiner added.

With the US imposing sanctions last week on Russian oil giants Rosneft and Lukoil, which account for over half of Russian oil production and exports and over two-thirds of India’s Russian oil imports, India’s Russian oil imports are set to come down drastically, accoridg to industry sources. India’s largest refiner Indian Oil Corporation (IOC) on Monday said that it will comply with all sanctions imposed by the international community, but declined to comment directly on the future of the company’s Russian oil imports. Private sector giant RIL, which accounts for around half of India’s Russian oil imports, had said Friday that it was assessing the implications and compliance requirements following the sanctions, and will be “complying fully” with any guidance on the issue from the Indian government.

Considering that other Russian oil exporters and traders dealing in Russian crude have not been sanctioned by Washington, some volumes of Russian oil could still find their way to India, although nowhere close to the volumes seen over the past three years. Russia is currently India’s largest source of crude, accounting for over 35 per cent of India’s overall oil imports so far in 2025. Majority of Russian crude oil flowing to India was being imported by private sector refiners RIL and Nayara Energy, in which Rosneft is part of the promoter group.

The threat of secondary sanctions from the US is the reason why countries like India, while politically opposed to unilateral economic sanctions, usually steer clear of countries and other entities sanctioned by Washington. While primary sanctions—on Rosneft and Lukoil in this case—mainly curtail or prohibit the engagement of American citizens and entities with the sanctioned entities, secondary sanctions seek to limit the engagement of other countries and their entities—over whom the US has no legal control—with the target country or entity. Oil industry insiders said that the companies and banks are likely to adopt an approach of abundant caution to ensure that they do not attract secondary sanctions.

The latest move from the Donald Trump administration—which had so far not imposed direct sanctions on Russian oil majors even as it pressured New Delhi to cut oil imports from Moscow—is a major escalation in its bid to force the Kremlin’s hand into ending the war in Ukraine. According to the US Treasury Department, all existing transactions involving Rosneft and Lukoil must be wound down by November 21.

Historically, India has avoided oil imports from countries like Iran and Venezuela, whose oil was sanctioned by the US, and industry watchers and experts expect a similar approach on oil from Rosneft and Lukoil. Given Indian refiners’ and banks’ exposure to the US—from dollar-denominated trade to access to the American financial system and markets—potential secondary sanctions could have a significant impact on them.