Indian refiners are in search of crude supply from as far as Angola in Africa and Venezuela in South America as their term supplies from the Middle East are trapped again and unable to reach India as planned.
Some of the biggest state-held refiners in India, the world’s third-largest crude oil importer, are looking for and testing new crude grades, to offset part of the supply lost to the Middle East conflict, senior refinery executives told Indian outlet Economic Times.
“We diversified our crude sourcing outside of the Strait of Hormuz, exploring multiple geographies including two new crude grades from Venezuela and Angola,” Vetsa Ramakrishna Gupta, finance director at state-run Bharat Petroleum Corporation Limited (BPCL), told ET.
Another state-run refiner, Hindustan Petroleum Corporation Limited (HPCL), said it barely got any term supplies from the Middle East in the first quarter as cargoes were trapped in the Persian Gulf west of the Strait of Hormuz.
“This time in the first quarter, we hardly got anything from our term contracts because a lot of the term contracts were sitting on the other side of Strait of Hormuz,” HPCL managing director Vikas Kaushal told the Indian outlet.
“We had to make decisions based on availability rather than optimisation,” the executive added.
India’s crude oil imports from Russia have remained close to record-high levels in July despite the end of the U.S. waiver the previous month.
But this week, some of India’s state refiners suspended crude oil loadings from Iraq, amid the escalation of hostilities in the Middle East and the abrupt halt to traffic through the Strait of Hormuz.
Indian Oil Corp and Mangalore Refinery and Petrochemicals Limited (MRPL) have reportedly suspended crude loadings from Iraq, with Indian Oil ditching earlier plans to load the supertanker Lila Jamnagar, concluding that sending a fully laden 2-million-barrel tanker through Hormuz was no longer worth the risk. MRPL has also halted Iraqi liftings as security in the region continues to deteriorate.
Source: Oilprice