SBI Halts Nayara Energy’s Foreign Transactions Amid Rising Russia-Linked Sanctions

India’s largest public sector lender, State Bank of India (SBI), has reportedly halted trade and foreign currency transactions for Nayara Energy, a private refiner in which Russia’s Rosneft holds a 49 per cent stake, The New Indian Express reported.

The move comes amid heightened US and European Union sanctions targeting entities linked to Russian energy assets.

According to reports, SBI, whose operations span the US and Europe, acted independently to reduce compliance risks and avoid potential penalties from global regulators.

There has been no formal directive from the Indian government. The precautionary measure follows the EU’s July 18 sanctions package, which included asset freezes, financial restrictions, and a tighter oil price cap. Nayara’s inclusion on the sanctions list is tied to Rosneft’s stake in the company.

The decision compounds recent challenges for Nayara, which accounts for about 8 per cent of India’s refining capacity. Just last month, Microsoft Corporation cut off the company’s access to its data services over the same Russian link.

Access was restored only after Nayara approached the Delhi High Court.

Industry observers say these developments reflect the increasing operational hurdles for Indian companies with cross-border energy dealings involving Russian connections.

For SBI, the move underscores how sanctions compliance has become a priority for globally active banks, even in the absence of domestic restrictions.

Nayara is reportedly seeking alternative banking arrangements, including with UCO Bank, which has historically handled sensitive transactions involving sanctioned countries due to its limited overseas exposure.

The latest sanctions have further squeezed Nayara’s export prospects, adding pressure to its Vadinar refinery operations, already navigating the complexities of global Russian oil trade.

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