Two months after European sanctions disrupted Indian refiner Nayara Energy Ltd., forcing the sudden departure of its European executives and severely affecting trade, the company’s operations and sales are showing signs of recovery, supported by government assistance and strategic workarounds.

 

Nayara, part-owned by Russia’s Rosneft PJSC and one of the most high-profile Indian firms to face comprehensive sanctions, is now coordinating with banks, including the State Bank of India, to process payments in local currency, according to sources familiar with the matter. UCO Bank had already received government approval earlier this month to work with Nayara and is expected to manage overseas transactions.

 

Operational recovery is also underway, enabling the refiner to meet domestic commitments across its more than 6,500 fuel outlets and to gradually rebuild its export network, using floating storage and a fleet of ships, including some previously sanctioned vessels, according to ship-tracking data compiled by Bloomberg. At least one state-run processor, Hindustan Petroleum Corp., has increased its purchases from Nayara, a government official said on condition of anonymity.

 

The refinery is currently operating at around 75 percent capacity, with production steadily increasing. Previously reliant on crude from Saudi Arabia, Iraq, and Russia, the Vadinar facility is now primarily processing Russian Urals, supplemented by small amounts of Indian crude.

 

Speaking at an energy conference in New Delhi, Nayara Chairman Prasad Panicker said, “India’s refining sector has the resilience to ensure that whatever is happening in geopolitics, we would continue to run at more than 100 percent capacity.”