India refuses Russian LNG: Reuters reveals reason
Photo: LNG tanker (Getty Images)
India has refused to buy Russian liquefied natural gas (LNG), subject to US sanctions, despite shortages caused by tensions in the Middle East, Reuters reports.
The agency noted that the move highlights the "fine balance" the world’s third-largest oil importer and consumer is trying to maintain between securing energy supplies and avoiding sanctioned LNG shipments. Such cargoes are harder to conceal and carry a higher risk of violating sanctions laws.
India’s refusal to purchase Russian gas also underscores Moscow’s limited ability to redirect its gas exports to new markets.
Tracking the LNG tanker
One informed source said unloading LNG from Russia’s Portovaya plant, which is under US sanctions and located in the Baltic Sea, became impossible even though India had been listed as the destination in mid-April.
According to the source, the vessel was being tracked despite documents indicating the cargo was non-Russian.
The 138,200-cubic-meter LNG tanker Kunpeng is heading toward the LNG import terminal in Dahej in western India. It is currently near Singaporean waters, with no destination listed.
Challenges in concealing cargo
One source explained that crude oil cargoes can be concealed through ship-to-ship transfers at sea, but LNG shipments are far more difficult to hide from satellite tracking.
India remains willing to buy authorised Russian LNG, but most of those volumes are intended for Europe. The source also noted that China remains a major buyer of both sanctioned and unsanctioned Russian LNG.
As previously reported, the war involving Iran has sharply reduced global oil reserves. Morgan Stanley estimates that global oil inventories have fallen by about 4.8 million barrels per day, increasing the risk of sharp price spikes and shortages.
India is also facing the threat of a major fuel crisis due to the conflict in the Middle East and the blocking of the Strait of Hormuz. Prime Minister Narendra Modi has urged citizens to cut fuel consumption as much as possible.
