Indian state refiners are considering tapping the West Asian crude market as spot supply from their top supplier Russia have fallen, three refining sources said, in a move that could support prices for high-sulphur oil.
The three large state refiners — Indian Oil Corp, Bharat Petroleum Corp and Hindustan Petroleum — are short of 8-10 million barrels of Russian oil for January loading, the sources told Reuters.
The refiners fear continued problems in securing Russian oil in the spot market could continue in the coming months as Moscow’s own demand is rising and it has to meet commitments under the Opec pact. However, they added that they can draw from their inventories to meet crude processing needs in March.
Two of the sources said their company may lift more crude from West Asian suppliers under optional volumes in term contracts or to float a spot tender for high-sulphur oil.
IOC, the country’s top refiner, previously floated spot tenders to buy sour grades in March 2022. The companies did not immediately respond to requests for comment.
India became the largest importer of Russian crude after the European Union, previously the top buyer, imposed sanctions on Russian oil imports in response to the 2022 invasion of Ukraine. Russian oil accounts for more than a third of India’s energy imports. Russia’s spot crude exports have fallen since November.