BPCL to cut Russian oil imports in November on higher costs

Key facts

• BPCL will reduce Russian crude oil purchases in November due to higher freight costs and premiums.
• Middle Eastern oil grades are currently more commercially attractive for BPCL.
• Russian crude accounted for 37% of BPCL's supplies in the July-September quarter.
• Purchases of Russian cargoes for November will be significantly reduced.
• The premium for Russian crude has fallen to $1-$2 per barrel for December cargoes, down from $13 per barrel for this month.

Bharat Petroleum Corporation Limited (BPCL), a major Indian state-owned refiner, plans to significantly cut its purchases of Russian crude oil in November. This decision stems from higher freight costs and premiums associated with Russian oil, making grades from the Middle East more commercially appealing. Russian crude constituted 37% of BPCL's supplies between July and September, but this proportion is expected to decrease. The premium for Russian crude has fallen to $1-$2 per barrel for December cargoes, a sharp drop from $13 per barrel for this month's shipments. This shift aligns with a broader trend of Indian refiners preferring Middle Eastern oil due to competitive pricing and shorter shipping routes, especially as China increases its demand for Russian crude.