“SBI Suspends Nayara Energy’s Trade & Forex Services Over Russia Sanctions Risk”
SBI has suspended international trade and forex services for Nayara Energy over Russian sanctions risk linked to Rosneft. Learn the reasons, EU sanctions impact, and possible alternatives.
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SBI Suspends Trade and Forex Services for Nayara Energy Amid Russia-Linked Sanctions Concerns
On 12 August 2025, India's largest public-sector bank, State Bank of India (SBI), reportedly stopped processing international trade and foreign currency transactions for Nayara Energy, the private refiner in which Russia’s Rosneft holds a significant stake.
This preemptive decision stems from escalating concerns over potential US tariff hikes and European Union sanctions, particularly following Nayara Energy’s inclusion in the EU’s 18th sanctions package, announced in July 2025. Despite its wide global footprint—including branches in the US and Europe —SBI acted independently, not under any government mandate, to mitigate compliance risks.
Nayara Energy, which represents around 8% of India’s refining capacity, now faces mounting operational and financial pressures. This follows a recent incident where Microsoft briefly terminated its data services to Nayara due to similar concerns —a measure reversed after Nayara secured relief from the Delhi High Court.
As export ties weaken under the weight of sanctions, Nayara is exploring alternatives such as partnering with UCO Bank, which has historically handled sanction-sensitive transactions due to its limited international exposure.
Observers suggest this episode underscores the growing hurdles Indian firms with cross-border energy operations and Russian linkages now face, while also highlighting the heightened role of sanctions compliance in banks with global reach—even in the absence of domestic directives.
