Indian tycoon Lakshmi Mittal's venture tied to Russian oil shipments via blacklisted vessels
The crude was transported from Russia aboard ships that had been blacklisted by the United States before being transferred offshore to another vessel for the final leg to India
A joint venture co-owned by Indian billionaire Lakshmi Mittal purchased Russian oil shipments transported for much of their journey on vessels blacklisted under Western sanctions, according to customs data and satellite tracking reviewed by the Financial Times.
HPCL-Mittal Energy Limited (HMEL), which operates the Guru Gobind Singh Refinery in Punjab, received at least four shipments of crude oil between July and September this year. The deliveries, valued at about $277 million, were sourced from Russia's Arctic port of Murmansk and involved two grades of crude - Novy Port and Arco.
HMEL is a joint venture between the Mittal group and state-owned Hindustan Petroleum Corporation Limited, each holding a 49% stake. The oil was supplied by Varda LLC, a St Petersburg-based company, according to customs filings seen by the Financial Times.
Keep updated, follow The Business Standard's Google news channel
Transport on sanctioned vessels
The crude was transported from Russia aboard ships that had been blacklisted by the United States before being transferred offshore to another vessel for the final leg to India.
Four sanctioned ships - Belgorod, Danshui, Dignity, and Primorye - carried the oil from Murmansk to the Gulf of Oman. They then reportedly transferred their cargo to the Samadha, a tanker not sanctioned by the US but previously blacklisted by the European Union and later sanctioned by the United Kingdom.
All the vessels were reported to have engaged in deceptive practices such as turning off their transponders or broadcasting false positions to conceal their activities. Satellite imagery showed the Samadha anchored alongside the other ships during ship-to-ship transfers in the Gulf of Oman.
The Samadha then made repeated voyages to Mundra port in Gujarat, western India, where the oil was offloaded. Although its transponder data indicated routine trips to Oman, satellite images revealed that the vessel was often several nautical miles away from its reported position.
Once unloaded in Mundra, the crude was transported via a 1,000 km pipeline to HMEL's inland refinery in Bathinda, Punjab.
Opaque ownership
It is not known who arranged the use of the sanctioned tankers or whether HMEL was aware of their involvement. The registered owner and manager of the Samadha, Seychelles-based Erika Freight Limited, shares an address with more than a dozen other so-called "shadow fleet" vessels, according to corporate records cited in the report.
Varda LLC, the supplier listed in HMEL's customs filings, could not be reached for comment and has no online presence or contact information in Russian corporate registries.
Growing scrutiny of Russian oil trade
The findings come as Washington increases pressure on Indian companies to limit purchases of Russian crude, after the US Treasury imposed additional sanctions on Russian oil firms Rosneft and Lukoil.
India has become one of the largest buyers of Russian oil since Moscow's 2022 invasion of Ukraine, importing an estimated 1.7 million barrels of seaborne crude per day - second only to China - largely due to discounted prices.
A former US trade and security official said buyers need "enough visibility in the full transport chain" to avoid exposure to sanctioned activity. "Entities are at risk if they are one hop or two hops from a sanctioned activity," the official said.
Risks of deceptive shipping practices
Deceptive practices such as "spoofing" and switching off transponders obscure the true origin and movement of oil shipments, complicating enforcement efforts. In this case, the blacklisted ships reportedly went "dark" for periods of three to six days as they approached the Gulf of Oman, coinciding with the timing of the transfers.
Experts warn that companies purchasing oil transported through such networks face legal and financial exposure, as well as reputational risks, if linked to sanctioned vessels or entities.
The US, UK, and EU have sanctioned numerous ships for similar behavior as part of efforts to enforce the price cap and restrict Russia's oil revenues.
