Some relief for Nayara! Microsoft restores IT services to Russia-backed Indian oil refinery; US company abruptly halted operations after EU sanctions

EU sanctions on Russia: Global IT giant Microsoft has restored IT services to Russia-backed Indian oil refinery Nayara Energy, according to a Reuters report. The move comes after Nayara had sued Microsoft for abrupt suspension of services following European Union’s fresh sanctions on Russia.According to a Reuters report, Nayara’s lawyer told a New Delhi court today that the services have been restored by the US company. The EU’s recent sanctions have significantly impacted Nayara’s operations, compelling the company to reduce activities at its refinery, which has a daily processing capacity of 400,000 barrels. The constraints arose from limited fuel storage facilities and vessel operators seeking to terminate their agreements with the company.

Why Microsoft Suspended Services to Nayara

Microsoft halted its services following the European Union’s new sanctions against Russia and its energy sector implemented on July 18, which affected Nayara, a company predominantly controlled by Russian organisations, including the oil giant Rosneft.Also Read | Troubles mount! Russia-backed Indian oil refinery reels from EU sanctions blow; Nayara faces new challenges as shippers look to end contractsNayara filed a petition in a New Delhi court seeking an order for Microsoft to reinstate its services, pointing out that staff members were unable to use corporate emails and access essential business information required for daily functions.During Wednesday’s proceedings, Nayara’s legal representative informed the judge that the “matter has been resolved” as Microsoft had resumed its services to the company.Microsoft subsequently confirmed to Reuters that it had restored all services for Nayara Energy.

What Nayara Energy Said

Microsoft terminated its services to Nayara beginning Tuesday of the previous week, which impacted staff members’ ability to use Outlook email and Teams communication services.“While the sanctions originate exclusively from the EU, Microsoft—a US-headquartered corporation—has chosen to withdraw services from Nayara Energy without any legal requirement to do so under US or Indian law,” Nayara stated on Monday.“This action has been taken unilaterally, without prior notice, consultation or recourse, and under the guise of compliance. Such moves signal a worrying trend of global corporations extending foreign legal frameworks into jurisdictions where they have no applicability,” Nayara said.