Essar Oil seeks over $1-bn loan from traders as banks fear Russian links

Indian refiner Essar Oil is looking to raise over $1 billion from trading houses after its new Russian owners could not raise loans from major Western banks due to sanctions on Russia.
Essar wants to borrow the money for 3-4 years and repay it with cargoes of refined products as it seeks to cut its reliance on lending from Indian banks, banking and trading sources familiar with the discussions said.

It would be the first large multi-year pre-payment deal by Essar, which has previously engaged only in short-term deals.
Russian oil major Rosneft, fund UCP and Swiss commodities trader Trafigura bought Essar Oil’s large refinery, 3,500 fuel stations and infrastructure for $12.9 billion last year.

Kremlin-owned Rosneft has been under U. S. sanctions since Russia’s annexation of Crimea in 2014.
The Essar deal was funded mainly by Russian state banks, including sanction-hit VTB, and the new owners’ attempts to partially borrow from large Western banks have so far not progressed.