SBI Stops Processing Nayara Energy Transactions

The State Bank of India (SBI) has halted trade and foreign currency transactions for Nayara Energy due to concerns about potential sanctions stemming from recent U.S. tariff hikes, according to a report by The Economic Times. This precautionary move is intended to ensure full compliance with international regulatory norms and was based on the bank’s internal assessment, not any directive from the government. The action follows the latest round of U.S. and EU sanctions targeting Russian-linked businesses.

Nayara Energy, formerly Essar Oil, was acquired in 2017 by a consortium led by Russian oil giant Rosneft. It owns the Vadinar refinery with a capacity of 20 million tonnes per annum and accounts for about 8% of India’s total refining capacity. Nayara also operates over 6,500 fuel stations across the country.

The company imports crude oil for refining and exports products like petrol and diesel to regions including Europe and the Middle East. However, its operations have come under pressure following the EU’s 18th sanctions package, which took effect in July and imposed a $47.6 per barrel price cap on Russian crude, tightening compliance requirements for global banks.