An industry group representing oil companies in Madagascar, including France’s TotalEnergies, has warned that the government’s move to nationalize fuel imports could force them and their clients to trade and use oil subject to international sanctions, including Russian barrels, according to a Bloomberg report.
The Groupement Pétrolier de Madagascar (GPM) said the legislation, passed by parliament on 1 July, would dismantle a market-based system that has operated since the sector was privatized in 1999. It would replace open tenders coordinated by the industry union with a state oil company controlling fuel imports, a shift that GPM argues reduces transparency and could enable politically driven supply decisions.
Among the major international clients that could be affected, GPM listed Air France-KLM, mining operations owned or partly owned by Rio Tinto Group and Korea Mine Rehabilitation & Mineral Resources, and other international construction firms. If they are forced to use fuel with unclear or sanctioned origins, they could face compliance problems in Western markets, the group cautioned.
Political shift and Russian ties
The nationalization plan comes after a military coup in October 2025 brought Colonel Michael Randrianirina to power. In February 2026, Randrianirina met with Russian President Vladimir Putin in Moscow and later approved the presence of Russian military instructors and arms supplies. Weeks before the fuel bill was introduced, Prime Minister Mamitiana Rajaonarison told the Russian state agency Sputnik that Madagascar could establish a fuel storage hub as part of a broader programme to attract Russian investment.
While Madagascar consumes only around 1 million tonnes of petroleum products per year, its position near the Mozambique Channel—through which nearly a third of global seaborne crude oil shipments pass—gives it outsized logistical significance.
Sanctions and supply chain risks
GPM warned that the new state import monopoly could allow traders to bring in sanctioned Russian fuel and then re-export it through African routes, complicating efforts by the European Union to track the origin of energy cargoes. European businesses that rely on fuel supplies on the island, the group said, could incur extra costs to verify product origins, review contracts, adjust insurance cover, and rework supply chains.
Industry analysts note that for Russia, gaining a logistical foothold near one of the world’s key oil transit corridors would help it redirect exports that have been blocked by Western sanctions and strengthen its influence in southern and eastern Africa. The bill has already been approved by the lower house of parliament and is expected to move toward implementation, though it has not yet been formally enacted.
