Refiners prune Saudi oil imports in hedge against fall in demand
NEW DELHI: Indian refiners are reducing crude shipments under term contracts, including from OPEC lynchpin Saudi Arabia, and looking at raising spot purchase to better manage expected contraction in demand in the coming months as several units head for maintenance shutdowns and a resurgence in Covid-19 cases prompts local lockdowns.
Sources said May shipment orders for Saudi crude from state-run Indian Oil Corporation and three other refiners stood at 65% of the monthly average of about 15 million barrels.
The reduction comes in the backdrop of Saudi Aramco on Sunday raising the May ‘official selling price’, or OSP, for Asian buyers and souring of bilateral ties over Riyadh ignoring India’s persistent calls for reversing production cut that boosted oil prices and pushed pump prices in India to record highs.
Interestingly, the supposed “retaliation” by New Delhi comes amid Saudi Aramco’s ongoing partnership talks with a conglomerate of state-run refiners for a proposed $40-billion refinery in Maharashtra and a stake deal in Reliance Industries Ltd’s O2C (oil-to-chemicals) venture.
