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By Kate Plummer
Senior US News Reporter
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The U.S. has imported $192 million in oil products from a refinery owned in part by a Russian company that is sanctioned by the U.S, according to data from an independent research group made available to Newsweek.
Why It Matters
After Russia invaded Ukraine on February 24, 2022, the U.S. and other Western countries imposed a range of economic and trade sanctions, including on Russian oil imports, to squeeze Moscow's economy.
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A route to potentially circumvent these sanctions soon emerged, with Russia exporting oil to third-party states that have not placed sanctions on Moscow. These countries in turn exported fuel products to the West via various companies.
The Kremlin, the White House, the U.S. Treasury and the U.S. Department of State, and the refineries mentioned in this story did not respond to Newsweek's request for comment.
What To Know
Nayara Energy, a refiner backed by Rosneft, exported 124 million euros ($135 million) of oil refined from Russian crude to the U.S.—a clear majority of its total of $192 million in exports to the U.S.—from its Vadinar refinery in India between January 2024 to the end of January 2025.
There is no suggestion that its intention was purely to circumvent sanctions, only that their action exploited what experts have called a "loophole."
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Nayara Energy is owned by three companies, including Rosneft, a state-controlled Russian energy company, which has owned a 49.13 percent stake in Nayara since 2016.
Rosneft is sanctioned by Washington, meaning it is barred from accessing financial institutions and trading with the U.S.
At the time of Rosneft's acquisition of Nayara Energy, Andrey Kostin, head of the Russian lender VTB told Reuters that part of the reason it only purchased 49 percent was to avoid the 50-percent controlling stake that would have triggered sanctions.
If it owned 50 percent or more, this would open Nayara Energy to facing the same trade sanctions Rosneft itself is under.
Nayara Energy's other owners are Italian energy investment group Hara Capital Sarl, and Cyprus-based Russian investment group United Capital Partners, whose founder Ilya Sherbovich is sanctioned by Ukraine, according to Reuters.
The importation data comes from the Center for Research on Energy and Clean Air (CREA), which uses global trade intelligence company Kpler to track fossil fuel exports from Russia.
Kpler uses historic and live automatic identification system data, and customs information in its research. CREA also uses shipping database Equasis to source vessel owners.
What People Are Saying
Speaking to Newsweek, Maximilian Hess, fellow at the Foreign Policy Research Institute and author of Economic War: Ukraine and the Global Conflict Between Russia and the West, said that while trading with Nayara does not violate sanctions, the dealings are "a great example of loopholes" in the system.
Kyle Haynes, an assistant professor at Purdue University's Department of Political Science, said: "These kinds of 'cat-and-mouse' games are extremely common. Sanctioned states always try to find workarounds using intermediaries, shell companies, smuggling, etc."
Russia has made a total of 847 billion euros in fossil fuel revenue since the war began in 2022.
What Happens Next
The extent to which sanction compliance will remain on the U.S. political agenda is in question as geopolitical relations shift.
Since President Donald Trump assumed office in January 2025, he has improved White House relations with the Kremlin and sought negotiations to end the war between Russia and Ukraine.
Hilary Ingham, professor in economics at the University of Lancaster in the U.K., said the sanctions issue might become "moot".
"Any meaningful reduction of U.S. sanctions on Russia would be a potential gamechanger, as there is strong evidence that sanctions are finally beginning to bite the Russian economy, causing significant inflation," she told Newsweek.
Haynes added: "If Trump throws Putin an economic lifeline, it could allow Russia to sustain its war in Ukraine much longer, and then rebuild its economy and allow Putin to threaten other European countries (including NATO states) on an accelerated timeline."
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