India has reportedly shipped its first cargo of diesel fuel to China since 2021, with about 496,000 barrels of ultra-low sulfur product setting sail from the port city of Vadinar on July 18 — only a few hours before the European Union announced new restrictions on the Russia-linked company handling the shipment.
Vadinar is the location of a refinery operated by Nayara Energy, an Indian company partly owned by Russian oil giant Rosneft. Nayara’s ties to Rosneft have been causing problems for the company, especially after President Donald Trump began heavily pressuring India to stop buying energy products from Russia.
The European Union (EU) also imposed sanctions on Nayara Energy in July, which drove off several supertankers that were in transit to the facility with cargoes of Russian crude. According to Bloomberg’s sources, a tanker called EM Zenith was able to scoot out of Vadinar just before the EU launched its latest crackdown on Russia’s oil business.
“The vessel was initially bound for Malaysia but made a U-turn in the Strait of Malacca and was anchored for about 12 days as multiple Nayara cargoes were stranded after the EU sanctions. The tanker has now updated its destination to Zhoushan, China,” said the Bloomberg report.
India’s strained relations with China have precluded shipments of refined fuel over the past four years.
As of Thursday, it was unclear if the Zenith’s voyage to China would be a one-off shipment of convenience, unloading a cargo of politically problematic fuel to a convenient buyer, or a sign of thawing relations between China and India — perhaps motivated in part by the growing gulf on trade issues between India and the United States.
India’s The Print on Wednesday suggested a clue might be found in China relaxing restrictions on exports to India of the crop nutrient urea. Beijing restricted these exports in June 2024, ostensibly because Chinese farmers needed the nutrient. India’s purchases of urea from China fell from $774 million to just under $43 million the following year.
“The political thaw between New Delhi and Beijing comes as U.S. President Trump takes aim at India in particular. The American President most recently last week imposed an additional tariff of 25 percent on imports from India, increasing the total levies on Indian imports to 50 percent,” The Print observed.
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