Nayara Energy Halts Operations for Maintenance Amid Fuel Supply Concerns
Nayara Energy's Planned Maintenance
Nayara Energy, recognized as India's second-largest private refinery, has announced a temporary suspension of its operations for a duration of 35 days to conduct essential maintenance. Reports indicate that this could result in a loss of approximately 8% of India's refining capacity. In response to inquiries, Nayara Energy clarified, 'This is a scheduled maintenance turnaround, and there will be no disruption at the pumps. We have reserves that can last for 40 days, ensuring that no pump will run dry.' The company reassured customers of its commitment to fulfilling India's energy requirements by providing a steady supply of high-quality fuels. Their extensive network of over 7,000 retail outlets will continue to function without interruptions.
It is important to note that a significant portion of Nayara's production is directed towards the domestic market, with exports having decreased following last year's sanctions. Much of their output is supplied to state-owned refiners, which market more fuel than they produce. The remaining volumes are distributed through Nayara's extensive retail network.
Last year, the European Union imposed sanctions on Nayara Energy concerning the export of refined petroleum products sourced from Russian crude, which included financial and shipping restrictions, as well as a price cap on Russian crude. Nayara Energy condemned these sanctions, asserting that they are based on unfounded claims and represent an unwarranted extension of authority that disregards international law and India's sovereignty. The company highlighted the hypocrisy of European nations that continue to import Russian energy while sanctioning Indian entities for processing Russian crude, which primarily serves the needs of India's 1.4 billion population.
According to data from Kpler, Nayara's imports surged significantly in 2023, with 226 kbd of crude imported from the region, increasing to 273 kbd in 2024 and 302 kbd in 2025. A report from JM Financial noted that India acquired around 30 million barrels of Russian crude after receiving a temporary waiver from the United States, which allowed refiners to access discounted oil. The U.S. has temporarily lifted restrictions on India's purchase of Russian crude, granting a 30-day waiver for shipments that were previously stranded at sea. Following Russia's invasion of Ukraine in 2022, India emerged as the largest buyer of seaborne Russian crude, benefiting from substantial discounts on the Urals crude benchmark.
Recently, Nayara Energy increased petrol prices by Rs 5 per litre and diesel by Rs 3 per litre due to rising global oil prices, passing some of the increased input costs onto consumers.
Government Reduces Excise Duty
In light of the escalating global crude oil crisis, the central government has reduced the Special Additional Excise Duty on petrol and diesel by Rs 10 per litre each. This adjustment has lowered the duty on petrol to Rs 3 and eliminated it for diesel. The government also stated that India has approximately 60 days of oil stock cover and reassured the public that there is no shortage of petrol, diesel, or LPG, labeling reports of shortages as a 'deliberate misinformation campaign' aimed at inciting panic buying. Additionally, major oil companies such as Indian Oil Corporation (IOC), Bharat Petroleum Corporation Ltd (BPCL), and Hindustan Petroleum Corporation Ltd (HPCL) confirmed that their petrol stations are operating normally and that there is no fuel shortage.