Reliance Industries, the top private refiner in India, has accelerated crude oil purchases from the Middle East, traders told Bloomberg on Tuesday, as the fate of Russian barrels going to India remains unclear.
Reliance, which typically buys crude from the Middle East, has been more active than usual in procuring oil from the Gulf region in recent weeks.
The refiner has bought at least 2.5 million barrels of crude from the Middle East recently, including Iraq’s Basrah Medium and Qatar’s Al-Shaheen and Qatar Land, according to Bloomberg’s sources.
Reliance is the top Indian buyer of Russian crude, which it purchases under a term deal with Russia’s top oil producer, Rosneft.
However, in recent days, the Indian refiner has been scouting for Middle East crudes with characteristics similar to the Russian oil it has been buying.
Russian crude may become problematic for Indian refiners soon, especially after U.S. President Donald Trump said last week that India had agreed to reduce its imports of Russian energy after months of stating it would not do so.
According to the U.S. President, India’s Prime Minister Narendra Modi had assured him that Indian refiners would stop buying Russian crude “within a short period of time”.
President Trump on Sunday reiterated his threat to make India pay “massive” tariffs unless it stops buying Russian oil, repeating that Modi had assured him those purchases would stop.
Last week, India neither confirmed nor denied that it would indeed cut or halt imports of Russian crude.
In response to comments on India’s energy sourcing, Randhir Jaiswal, an official spokesperson for the Foreign Ministry, said “India is a significant importer of oil and gas. It has been our consistent priority to safeguard the interests of the Indian consumer in a volatile energy scenario. Our import policies are guided entirely by this objective.”
Despite the U.S. claim that Indian refiners are already cutting imports from Russia by 50%, unspecified Indian industry sources told Reuters last week that any potential cuts could be shown in volumes for December and January imports as the refiners have already booked the cargo loadings for November and part of the loadings for December.
By Tsvetana Paraskova for Oilprice.com
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