Nayara Energy Bounces Back on Operations and Sales After Sanctions and Executive Exit

Indian refiner Nayara Energy Ltd. is recovering operations and sales two months after sanctions disrupted its business and forced the exit of European executives. The rebound has been supported by government backing and new payment channels.

Nayara, partly owned by Russia’s Rosneft PJSC and among the most prominent Indian firms targeted by sanctions  is working with lenders including State Bank of India to settle local currency payments, according to people familiar with the matter. UCO Bank, which received government approval earlier this month, is expected to oversee its overseas transactions.

Nayara Energy’s operations are gradually stabilizing, enabling the refiner to not only meet its domestic commitments — supplying more than 6,500 fuel outlets across India — but also reestablish an export network. According to Bloomberg’s ship-tracking data, the company is leveraging floating storage and a fleet of vessels, some of which remain under sanctions, to resume overseas trade. A government official said at least one state-run processor, Hindustan Petroleum Corp., has increased its purchases from Nayara, though the official requested anonymity while sharing private details.

Currently, the refinery is operating at about 75% capacity, with output steadily rising, according to a person directly involved. Once dependent on a mix of Saudi, Iraqi, and Russian crude grades, Nayara’s Vadinar facility is now running largely on Russian Urals, supplemented by smaller volumes of domestic oil, the person said.

As per recent media reports “The refining sector has the resilience to ensure that whatever happens in geopolitics, we will continue to operate at more than 100% capacity,” Nayara Chairman Prasad Panicker said.

The sanctions imposed by the European Union in July — announced by EU foreign policy chief Kaja Kallas on social platform X — blindsided the company. The measures disrupted management, froze access to basic Western software such as Microsoft, and created immediate uncertainty. In the aftermath, several board members, including CEO Alessandro Des Dorides and other EU citizens, resigned.

The crisis deepened further when shipping providers such as Great Eastern Shipping Co. ended contracts following the withdrawal of EU-backed P&I insurance coverage. Meanwhile, banks also tightened their positions, adding to the turmoil that Nayara is now cautiously emerging from.