New Delhi, Oct 29 (PTI) HPCL-Mittal Energy Ltd (HMEL) has suspended purchases of Russian crude oil, the company said on Tuesday, clarifying that the vessels, which delivered previous consignments, were not under international sanctions.

The private refiner, a joint venture between state-run Hindustan Petroleum Corporation Ltd (HPCL) and steel tycoon Lakshmi Mittal's Mittal Energy Investments, said it will continue to review its position and comply with government policy and applicable laws.

HMEL, which operates a 9 million tonnes a year oil refinery at Bhatinda in Punjab, is the first Indian firm to officially announce suspension of purchase of Russian crude after the US sanctioned two of Moscow's biggest oil firms.

Commenting on a Financial Times report, which stated that Indian refiner had received at least four crude shipments this year worth almost USD 280 million on sanctioned vessels, HMEL said it bought Russian oil on a delivered basis - meaning the supplier made shipping arrangements.

The company said it was not aware of the specific vessels that transported the cargo from Murmansk in Russia's far northwest, through the Atlantic Ocean and the Mediterranean Sea, but clarified that the ships, which eventually delivered the oil at Indian ports, were not under sanctions.

"Notwithstanding this, HMEL had already taken the decision to suspend further purchases of Russian crude upon recent announcements of new restrictions on imports of crude oil from Russia by the United States, European Union and United Kingdom, pending receipt of any outstanding orders," the company said in a statement.

The US last week imposed sanctions on Rosneft and Lukoil in a bid to pressure Moscow into ending its war in Ukraine.

Russia currently supplies nearly a third of India's crude imports, averaging around 1.7 million barrels per day (mbd) in 2025, of which approximately 1.2 mbd came directly from Rosneft and Lukoil. Most of these volumes were bought by private refiners, Reliance Industries Ltd and Nayara Energy, with smaller allocations to state-owned refiners, including HMEL.

Financial Times said the oil was transported on the US-blacklisted vessels between July and September from the Arctic port of Murmansk to as far as the Gulf of Oman. The oil was transferred on high seas to different vessels.

"The final leg of the journey into India was undertaken on the Samadha, a tanker that is not on US sanctions lists, though it was blacklisted by the EU," it said, citing an analysis of satellite imagery, shipping data and customs records.

HMEL said the ship Samadha, which delivered the crude to the port in India, was not under OFAC sanctions at the time of delivery.

The Office of Foreign Assets Control (OFAC) of the US Department of the Treasury administers and enforces economic and trade sanctions.

"HMEL always acts in full compliance with government policy and regulations," the company statement said.

"All transactions and acceptances of shipping deliveries by HMEL are subject to due diligence and compliance procedures." This includes counterparty KYC, sanctions screening, vessel history and prior port-clearance.

"Cargo is supplied to HMEL on a delivered-at-port basis. This means the company will not be aware of the details of other ships that crude may have been transported on, nor any attempts by those ships to conceal their position to pick up crude from sanctioned vessels," the company said.

Financial Times said all of the ships involved in the process sought to conceal their behaviour with a combination of deceptive practices, either shutting off their transponders or using them to broadcast false positions.

The publication went on to state that it was not aware of who arranged for the oil to be transported on the sanctioned tankers.

HMEL said its business activity was in line with the Indian government and its energy security policy.

"HMEL's refined output principally serves India's energy market needs alone, with no exports to the EU, UK and USA." Indian refiners have not placed any new orders for Russian oil after the US last week slapped sanctions on Moscow's top two crude exporters, as they assess the changed scenario to ensure not faulting with any international commitments.

Purchase of Russian oil, per se, has not been sanctioned, and it's only the Russian entities that have been blacklisted. This means that Russian crude, which is processed in refineries to make fuels like petrol and diesel, offered by any non-sanctioned entity could be considered.

This understanding was also reflected by IOC Director (Finance) Anuj Jain in a post-earnings analyst call on Tuesday.

"We are absolutely not going to discontinue (buying Russian crude) as long as we are complying with the sanctions. Russian crude is not sanctioned. It is the entities and the shipping lines which have got sanctions," he had said.

"If somebody comes to me with a non-sanctioned entity, and the (price) cap is being complied with, and the shipping is okay, then I will continue to buy it." While the Indian government has not officially responded to the sanctions announced by the US, industry sources said Indian refiners' import strategy would largely depend on how banking systems respond to the latest restrictions.

Reliance Industries Ltd, which has a 25-year term contract with Rosneft to buy up to 5,00,000 barrels per day of crude and is India's largest importer of Russian oil, may be the first company to stop importing oil from Moscow.

Last week, Reliance pledged full compliance with the Western sanctions on Russian crude imports while expressing confidence that its diversified sourcing strategy will maintain operational stability.

The company, which operates the world's largest refining complex at Gujarat's Jamnagar with 1.24 million barrels per day capacity, said it will adapt its refinery operations to meet new compliance requirements, following restrictions announced by the EU, UK and the US.

It, however, stopped short of saying whether it will halt purchases.

Rosneft-backed Nayara Energy, which is currently dependent solely on Russian oil after supplies from elsewhere dried up due to sanctions by the European Union, has very few options. PTI ANZ CS ANZ BAL BAL