India Halts Russian LNG Imports Under Sanctions, Discussions Ongoing on Approved Shipments

India Rejects Russian Offer to Sell Liquefied Natural Gas

India has declined Russia's offer to sell it liquefied natural gas (LNG) despite a shortfall driven by Middle East tensions, according to two sources with direct knowledge of the matter. This decision has left an LNG cargo from Russia's U.S.-sanctioned Portovaya plant in the Baltic Sea unable to discharge, despite indicating India as its destination in mid-April.

The stance highlights the fine balance the world's third-biggest oil importer and consumer is seeking to strike between securing energy supplies and avoiding LNG cargoes on which the U.S. has placed sanctions. These sanctions are harder to disguise and carry greater compliance risk. India's reluctance also underscores the limits of Moscow's ability to pivot its LNG exports to new markets.

The LNG cargo in question, a 138,200-cubic-metre tanker named Kunpeng, was tracked despite documentation suggesting the cargo was non-Russian. The vessel was initially heading to the Dahej LNG import terminal in western India but is now near Singaporean waters with no destination broadcast.

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India conveyed its decision not to buy LNG that was under sanction to Russia's Deputy Energy Minister Pavel Sorokin during his April 30 visit. Sorokin met with Indian officials, including Petroleum and Natural Gas Minister Hardeep Singh Puri, and could return in June for further talks.

India's Oil and Gas Ministry and Russia's embassy in Delhi did not immediately respond to requests for comment. Despite this decision, India's purchases of Russian crude have continued unabated, aided by a temporary waiver of U.S. sanctions introduced to help countries cope with an energy crisis resulting from the U.S.-Israeli war on Iran, which began on February 28.

Russia's Arctic LNG 2 is another export plant subject to U.S. sanctions, with Washington stepping up sanctions on the LNG plants in early 2025 over Russia's war on Ukraine. While crude oil cargoes can be hidden through ship-to-ship transfers at sea, LNG shipments are far harder to conceal from satellite tracking.

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India is open to buying authorised Russian LNG, but most of those volumes are committed to Europe. Moscow is also seeking long-term deals to supply India with LNG and fertilisers such as potash, phosphorus, and urea.

Before the Iran conflict disrupted shipping through the Strait of Hormuz, India was meeting half of its gas consumption through imports, about 60% of which had come through the waterway. More than half of its crude supplies came the same way. Prime Minister Narendra Modi recently urged people to conserve fuel and foreign exchange by working from home, limiting foreign travel, and reducing imports of gold and edible oil.