LAUNDROMATS

Why in news?: A new study by the Centre for Research on Energy and Clean Air (CREA) has found that countries that imposed crude oil sanctions on Russia used India, China, United Arab Emirates, Singapore and Turkey as ‘laundromats’ for refined products.

Key points:

During the last year, India has emerged as the leading exporter of refined oil products, followed by China and the United Arab Emirates.

Major exporting port:

Sikka port in Gujarat (owned by Reliance; handles import and export of petroleum from Jamnagar refinery) exported the highest amount of seaborne refined oil to the Price Cap Coalition countries

Vadinar port (also in Gujarat; owned by Nayara Energy Limited, of which Russian oil company Rosneft holds around 50% share)

India now imports about 87% of its crude oil requirement (worth over US $190 bn) while it exported petroleum products worth over $86 billion (accounting for more than 21 per cent of India’s total commodity exports)

What is Laundromat?

‘Laundromats’ is a term used to describe a type of financial fraud where large amounts of money, often obtained through illegal means, are moved through a complex web of transactions and accounts to disguise their origin and make them appear legitimate.

 What is the Price Cap plan?

Price Cap Coalition comprising Australia, Canada, the European Union, Japan, the United Kingdom and the United States imposed a maximum price of $60 a barrel of oil transported by vessels owned or insured by some countries in the alliance to third-party countries, with the intention to dent Russia’s financing of the war.