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After the IOC, two more cos are procuring Russian oil

New Delhi: Following the Indian Oil Corporation (IOC), Hindustan Petroleum Corporation Ltd (HPCL) bought two million barrels of Russian crude oil as Indian refineries stepped up efforts to make Russian oil available at big discounts. Like the IOC, HPCL also bought Russian Urals oil through European trader Vitol, sources familiar with the development said.
Separately, Mangalore Rafinery and Petrochemicals Ltd (MRPL) announced a tender seeking one million barrels of similar crude oil.
Western sanctions against Russia over its invasion of Ukraine have prompted many companies and countries to refrain from oil production. This has led to the fact that Russian oil is available on the market at big discounts.
To seize the opportunity, Indian refineries are tendering to buy such reduced oil. The tenders are mostly won by traders, who would have stocks of cheap Russian oil.
Sources said MOC, the nation’s largest oil company, bought three million barrels of the Urals via Vitol late last week for delivery in May at a $ 20-25 per barrel discount compared to Brent. HPCL made a rare purchase of two million barrels of Urals oil for loading in May this week, they said.
Meanwhile, Reliance Industries Ltd, the operator of the world’s largest refinery complex, could avoid buying Russian fuel because it has a large exposure in the US, and sanctions against Moscow could affect its business.
From 2020, the IOC has a contract to purchase crude oil from Russian Rosneft on a fixed-term or fixed-volume basis. But it rarely imported quantities under the term agreement because the cost of transporting oil from Russia made it uneconomical. But the cuts have reversed the flow in favor of Russian crude oil, and Indian refineries are flooding it, sources said.
MRPL, which, like HPCL, is also a subsidiary of the State Oil and Gas Corporation (ONGC), is also seeking a million barrels of such crude oil for loading by the end of May, they said.
Refineries buy Russian oil on the principle of delivery in order to avoid any complications that sanctions could lead to in organizing shipments and insurance.
Also, unlike US sanctions on Iran over its controversial nuclear program, oil and energy trade with Russia is not banned. This essentially means that every country or company was free to buy oil and other energy from Russia and use international payment systems to address trade. PTI



After the IOC, two more cos are procuring Russian oil

Source link After the IOC, two more cos are procuring Russian oil

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