Key facts
- BPCL bought 1 million barrels of WTI for delivery at Mumbai in late December to early January, trade sources told Reuters.
- BPCL paid a premium of about $18 per barrel over Dated Brent for the cargo, per Reuters' sources.
- Russian crude was 37% of BPCL's crude supplies in the July to September quarter, finance head Vetsa Ramakrishna Gupta said.
- Gupta said BPCL's purchases of Russian cargoes for November would be significantly reduced because of higher shipping costs.
- Freight for a supertanker carrying oil from the US to Asia was about $60 million in mid-October, Reuters reported.
Bharat Petroleum Corporation Limited, one of India's biggest state-owned refiners, bought 1 million barrels of US West Texas Intermediate crude, trade sources told Reuters on November 3. The cargo is for delivery at Mumbai in late December to early January, and BPCL paid a premium of about $18 per barrel over Dated Brent, according to Reuters' sources.
The purchase follows BPCL's statement that it would reduce its purchases of Russian crude oil in November. BPCL's head of finance, Vetsa Ramakrishna Gupta, said high freight costs and premiums for Russia's crude undermined its attractiveness compared with Middle Eastern offers, which he said were more commercially attractive for the company. Russian crude accounted for 37% of BPCL's crude supplies in the quarter from July to September, Gupta said, and purchases of Russian cargoes for November would be significantly reduced because of higher shipping costs.
Reuters reported that BPCL's sourcing decision was in line with a recent trend of lower Russian crude imports in India, as Middle Eastern cargoes became more available with increased flows through the Strait of Hormuz. Eased freight rates in the two weeks before the report also prompted Asian crude buyers, Chinese ones in particular, to seek cargoes from Brazil and West Africa. Freight rates had eased from record highs in early October but were still about $60 million for a supertanker carrying oil from the US to Asia in mid-October, a level that had kept Asian refiners from ordering much US crude for November delivery.