Indian refiners looking to buy OPEC oil

According to Webangah News quoted by Mehr News Agency State-run Indian refiners are considering importing more oil from Middle East oil exporters as single-cargo supplies from Russia, India’s biggest oil seller, are on the wane, three Indian refining sources said. , decreased is.

This move by Indian state oil refiners could support high sulfur oil prices.

These sources told Reuters that the three largest state-owned refineries in India Oil, Bharat Petroleum and Hindustan Petroleum do not have 8-10 million barrels of Russian oil to load in January.

Indian oil refiners are worried about continued supply problems from the Russian side in the spot market in the coming months, as Russia’s domestic demand is increasing and the country at the same time It is forced to comply with its obligations in the form of an agreement to reduce the supply of producers of the Organization of Petroleum Exporting Countries (OPEC) and non-OPEC known as OPEC Plus.

However, Indian refiners said they could use their stockpiles to meet crude oil refining needs in March.

Indian refiners may receive more crude oil from Middle East exporters based on discretionary volumes in long-term contracts or tenders, two Indian refining sources said. for oil with high sulfur.

Oil Refining Company Indian Oil (IOC), India’s largest state-owned oil refiner, had earlier held single-cargo tenders in March 2022 to buy sour crudes.

The companies did not immediately respond to requests for comment.

After the European Union, previously the largest buyer of Russian oil, imposed sanctions on Moscow in response to Moscow-Kiev tensions in February 2022, India It became the largest importer of Russian crude oil.

Russian oil accounts for more than a third of India’s energy imports.

Russia’s crude oil exports have been on the decline since November this year, as the country’s refineries completed maintenance and disrupted operations, traders said. Due to the bad weather, shipping resumed their activities.

Another of the three sources said that we need to look at alternative types of oil, because Russia’s domestic demand for oil is increasing, and at the same time we need to meet commitments act within the framework of the OPEC Plus supply reduction agreement.

Russia has promised to reduce its oil production from the end of 2024 in order to quickly compensate for the excess supply and violation of quotas in the form of the OPEC Plus supply reduction agreement.

Reuters reported earlier this month that Russia’s state-owned Rosneft signed a new contract with the refinery. Private Reliance India has signed to increase oil sales to this Indian refiner.

Sources told Reuters earlier this month that the new deal will cover about half of Rosneft’s offshore oil exports. of Russian terminals and leaves little supply for single cargo supply.

India has not imposed any sanctions on Russian oil, so Indian refiners have benefited from cheaper supplies than competitors’ prices by at least $3 to $4 per barrel.

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Indian refinery sources said there are traders in the market who are willing to buy Russian oil in exchange for Yuan. to supply China, but at the same time they reminded that Indian state refineries stopped paying for Russian oil in Yuan after the government recommended it last year. They did.

The first source said, it is not that there is no substitute for Russian oil in the market, but our economy will suffer.