Not violating sanctions on Russian oil, says Centre after EU Minister’s charge

Jaishankar says Russian crude, if substantially transformed in a third country, is not treated as Russian any more; Borrell calls for action, saying it is a ‘circumvention of sanctions’ if Indian diesel and petrol entering Europe are made from Russian oil

Hours before his meeting in Brussels with External Affairs Minister S. Jaishankar, the European Union’s (EU) Foreign Minister, Josep Borrell, said that Europe should not permit the entry of refined petroleum products from India that are made from Russian oil.

The government reacted by denying that it was violating sanctions and said it was not possible to fully identify the origins of petroleum products being sold in Europe.

Mr. Jaishankar said the contention was baseless. “Russian crude, if substantially transformed in a third country, is not treated as Russian any more,” Mr. Jaishankar said, referring to EU Council Regulation 833/2014.

While Mr. Borrell met Mr. Jaishankar at the trade technology talks, he was not present at the press conference that followed. In his place, EU Executive Vice-President on Competition Margrethe Vestager said there was “no doubt about the legal basis of the sanctions”, and that EU and India would have the discussion as “friends... with an extended hand and of course, not a pointed finger”.

Mr. Borrell’s remarks were made to the Financial Times in an interview, in which the Minister said it was “certainly a circumvention of sanctions” if Indian diesel and gasoline (petrol) entering Europe were made from Russian oil and that EU member states “have to act”.

The newspaper reported that, as per Mr. Borrell, Brussels “was aware that Indian refiners were buying large volumes of Russian crude oil before processing it into fuels for sale in Europe”.

Mr. Borrell said it was “normal” that India was buying cheap Russian oil following the G-7 price cap of $60 per barrel, but that it was not acceptable for that oil to be routed to Europe via refined products. He told the Financial Times that if India was acting as a “centre” where Russian oil is being refined and products being sold to the EU, then “we [the EU] have to act”.

Government sources dismissed the charge that India was circumventing sanctions, saying that the government had no knowledge of such sales. “We are not selling the oil abroad — this is being done by private entities and oil refineries that make commercial decisions. It is also not possible to tell whether these products being sold to Europe are being traded on the high seas, or even coming from India,” a source said.

Earlier this month, the Petroleum and Natural Gas Ministry strongly denied a Finland-based think tank’s report alleging that India led five countries that acted as “laundromats” to buy Russian oil and sell refined products to European countries.