
Indian Oil Corp (IOC), India’s largest refiner, has made a significant purchase of 7 million barrels of Middle Eastern and African crude oil as it adapts to ongoing disruptions in global oil supplies. The purchase comes in the wake of recent U.S. sanctions targeting Russian oil producers and tankers, which have affected India’s ability to import Russian crude.
According to sources familiar with the matter, IOC secured these barrels via tenders, including a rare purchase of Abu Dhabi’s Murban crude, sold by Totsa, the trading arm of French energy giant TotalEnergies. The Murban cargo, which amounts to 2 million barrels, was sold on a delivered basis and fetched a premium of around $5 per barrel above the Dubai price.
The sanctions imposed by Washington last Friday have had a noticeable impact on Russian oil exports, particularly affecting low-sulphur grades like Novy Port, ARCO, and Varandey, which had been regularly supplied to Indian refiners. These sanctions have forced Indian companies to look for alternative sources of crude, with Middle Eastern and African suppliers stepping in to meet the demand.
IOC’s purchases also include two Very Large Crude Carriers (VLCCs), each containing 1 million barrels of various African crudes. One VLCC carried Nigeria’s Agbami and Akpo crude, while the other contained Angola’s Nemba crude. Both shipments were secured from Shell and Chevron, respectively.
This strategic move highlights the broader shifts in global oil markets as refiners in top-importing countries like India and China seek alternatives to Russian and Iranian supplies. As a result, spot premiums for Middle Eastern crude have surged, reaching their highest levels in over two years.
Indian Oil Corp has also floated tenders for further crude purchases to cover the period from the second half of February to the first half of March. While the companies involved typically refrain from commenting on specific commercial deals, these moves reflect the ongoing adjustments to a rapidly changing geopolitical and economic landscape.
With the U.S. sanctions expected to tighten further, Indian refiners are increasingly relying on spot markets for crude purchases, particularly from regions such as the Middle East and Africa. This change in strategy comes at a time when global oil prices are experiencing significant fluctuations due to the tightening of supply chains and increased demand for alternative sources of crude.
Sources By Agencies