Two Indian firms have been penalized by the United States and the United Kingdom as part of the recent initiative targeting Russia‘s energy sector, which was revealed on Friday. The extensive actions taken by the US Treasury Department and the UK government focus on two prominent Russian oil producers, Gazprom Neft and Surgutneftegaz, along with related entities, and impose restrictions on 183 vessels involved in the transportation of Russian crude oil.

The Indian companies included in this action are Skyhart Management Services Private Limited and Avision Shipping Services Private Limited. According to a statement from the US State Department, these firms have been sanctioned for their purported involvement in supporting Russia’s Arctic LNG 2 project, which is partially owned and developed by Novatek, the largest liquefied natural gas producer in Russia. This project has been under US sanctions since 2023.

Both companies have been designated under Executive Order 14024 for materially aiding or providing support to the Arctic LNG 2 initiative. Furthermore, two vessels managed by Avision, named Pravasi and Onyx, have been identified as assets linked to the company.

US authorities have asserted that the Indian firms managed LNG carriers that loaded cargo from the project, alleging that “Russia has engaged in efforts to obfuscate LNG carriers’ ownership through third country ship management entities” in an “attempt to revitalize” the Arctic LNG 2 project.

In September of the previous year, Washington imposed sanctions on two additional Indian companies—Gotik and Plio Energy, both registered in Mumbai—claiming their connections to the project. It also sanctioned two vessels owned by these companies for their alleged involvement in “attempts to export” LNG from the Novatek project.

Last year, the United States enacted sanctions against 19 Indian companies and two individuals for their provision of electronics and aviation parts to Russian entities. In reaction, New Delhi asserted that these companies had adhered to domestic regulations and were functioning within the legal parameters of India. The Indian Ministry of Foreign Affairs indicated that discussions with Washington were ongoing to address and clarify these matters.

Over the past two years, Russia has become a significant energy ally for India, emerging as a primary supplier of crude oil. In September 2024, India’s crude oil imports from Russia increased by 11.7% compared to August, reaching approximately 1.9 million barrels per day, which represented about 40% of India’s total crude imports for that month. New Delhi has acknowledged Moscow’s vital role in bolstering the country’s energy security and has expressed intentions to enhance energy imports.

Nevertheless, the recent sanctions aimed at Russia’s tanker fleet may lead to substantial disruptions in Russian oil exports to India and another major consumer, China, as reported by Reuters, citing sources within the Russian and Indian oil sectors. To date, vessels transporting oil and LNG, along with numerous Russian oil traders, have managed to circumvent the most stringent US sanctions, as the Biden administration has been cautious about implementing more severe measures due to fears of a global increase in oil prices.