India has declined
Russia’s offer to sell it liquefied natural gas subject to U.S.
sanctions despite a shortfall driven by Middle East tensions,
said two sources with direct knowledge of the matter, leaving a
tanker bound for India in limbo as talks continue on permitted
cargoes.
The stance highlights the fine balance the world’s
third-biggest oil importer and consumer is seeking to strike
between securing energy supplies and avoiding LNG cargoes on
which the U.S. has placed sanctions, which are harder to
disguise and carry greater compliance risk. It also underscores
the limits of Moscow’s ability to pivot its LNG exports to new
markets.
India’s reluctance has left an LNG cargo from Russia’s
U.S.-sanctioned Portovaya plant in the Baltic Sea unable to
discharge, despite indicating India as its destination in
mid-April, one of the sources said. The vessel was tracked
despite documentation suggesting the cargo was non-Russian, the
source added.
Reuters had reported in mid-April, citing LSEG shipping
data, that the 138,200-cubic-metre tanker Kunpeng was heading to
the Dahej LNG import terminal in western India. The vessel is
now near Singaporean waters with no destination broadcast,
according to LSEG.
India, the biggest buyer of Russian seaborne crude, conveyed
its decision not to buy LNG that was under sanction to Russia’s
Deputy Energy Minister Pavel Sorokin during his April 30 visit,
when he met Indian officials including Petroleum and Natural Gas
Minister Hardeep Singh Puri, one of the sources said. It was
their second meeting in as many months, and Sorokin could return
in June for further talks, said the source.
India’s Oil and Gas Ministry and Russia’s embassy in Delhi
did not immediately respond to requests for comment.
‘RUSSIA KEEN TO SELL, INDIAN COMPANIES CAUTIOUS’
India’s purchases of Russian crude have meanwhile continued
unabated, aided by a temporary waiver of U.S. sanctions
introduced to help countries cope with an energy crisis
resulting from the U.S.-Israeli war on Iran, which began on
February 28.
Arctic LNG 2 is Russia’s other export plant subject to U.S.
sanctions. Washington stepped up sanctions on the LNG plants in
early 2025 over Russia’s war on Ukraine.
While crude oil cargoes can be hidden through ship-to-ship
transfers at sea, LNG shipments are far harder to conceal from
satellite tracking, one of the sources said.
India is open to buying authorised Russian LNG, but most of
those volumes are committed to Europe, the source said. The
source said China remains a major buyer of both sanctioned and
unsanctioned Russian LNG.
Moscow is also seeking long-term deals to supply India with
LNG and fertilisers such as potash, phosphorus and urea, the
source added.
Before the Iran conflict disrupted shipping through the
Strait of Hormuz, India was meeting half of its gas consumption
through imports, about 60% of which had come through the
waterway. More than half of its crude supplies came the same
way.
Indian Prime Minister Narendra Modi on Sunday urged people
to conserve fuel and foreign exchange by working from home,
limiting foreign travel and reducing imports of gold and edible
oil.