IOC buys 7 million barrels of crude from US, Canada and UAE as state refiners pause Russian oil purchases

According to Reuters, state refiners including IOC, BPCL, HPCL, and MRPL have not sought Russian crude in the past week or so

Indian Oil Corp (IOC), the country’s largest refiner, has bought 7 million barrels of crude oil for delivery in September through a spot tender, opting for supplies from the United States, Canada and the Middle East, Reuters reported citing multiple trade sources.

The unusually large purchase comes at a time when Indian state refiners are holding back on Russian crude amid shrinking price advantages and increased global scrutiny. According to two sources, the fresh deals are also meant to partly replace Russian barrels, Reuters said.

Shift in buying pattern as US crude turns attractive

IOC purchased 4.5 million barrels of U.S. crude, 500,000 barrels of Western Canadian Select (WCS) from Canada, and 2 million barrels of Das crude from Abu Dhabi, the Reuters report said. The company’s tender for these spot purchases closed on Friday.

The shipments were awarded as follows:

P66 and Equinor will supply 1 million barrels each of U.S. WTI Midland

Mercuria will deliver 2 million barrels of WTI Midland

Vitol will supply 1 million barrels each of WTI Midland and WCS

Trafigura will ship the 2 million barrels of Das crude

Pricing details were not immediately available, Reuters added.

Pause on Russian crude as discounts narrow

India, the world’s third-largest oil importer, has emerged as the top buyer of Russian seaborne crude since the West imposed sanctions on Moscow over its invasion of Ukraine in February 2022.

According to Reuters, state refiners including IOC, BPCL, HPCL, and MRPL have not sought Russian crude in the past week or so, a notable pause given their usual volume of Russian purchases.

U.S. President Donald Trump has also warned countries against buying oil from Russia, adding further geopolitical pressure. Meanwhile, the European Union has tightened sanctions on the Russian energy trade, making logistics and compliance more complex.