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Saudis for increasing raw supply to Indian oil in H2 2019




Saudi Arabia can soak up some of Iran's former market share in the Indian market when Saudi Aramco will ship another 2 million barrels per month to Indian Oil Corp between July and December this year on top of the existing forward contract between the two companies.

"We have been told to take 2 million barrels every month for six months from July (about 1.6 million tonnes in total), and they have agreed that" AK Sharma, Indian Oil's director (finance), told Reuters on Friday

India, Norway's second largest oil customer after China, was one of the eight countries that was given six months of resignation to continue buying oil from Iran after the US raised sanctions on the Iranian oil industry in November. However, the United States pursued a maximum press campaign against Iran last month and stopped stopping all sanctions for all Iranian oil buyers.

This enabled Indian refineries to source the market for alternatives, and many of them, especially private companies, did so because they are cautious about possible secondary US sanctions if they continue to buy oil from Iran.

Indian Oil Corp has a rally with Saudi Aramco about purchasing a total of 5.6 million tonnes in the 201[ads1]9/2020 fiscal year, plus an alternative to buying an additional 2 million tonnes, according to Reuters.

Indian Oil diversified its raw suppliers in the 2018/2019 fiscal year, and for the first time entered into a US source oil contract and strengthened its ability to process crude grades from a broader and cheaper basket, the company said. its annual results on Friday.

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Despite the fact that Indian Oil has requested extra Saudi supply, Indian refineries like a group are not said to have to buy extra raw from the kingdom.

Only an Indian refiner has agreed to buy additional crude oil supplies from Saudi Arabia to compensate for the loss of Iranian barrels, as India's firms have been looking for months to diversify their raw materials, and as the Kingdom increased its prices to Asia. to take advantage of the supply circuit.

Of the four state Indian refineries that bought Iranian oil Mangalore Refinery and Petrochemicals (MRPL), the only one who has taken up the Saudi offer for additional commodity sources, Reuters told Monday.

By Tsvetana Paraskova for Oilprice.com

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