The buying spree by the world’s third biggest oil importer underscores mounting concerns over supplies from Russia, which have plunged to the lowest since May after a wave of Ukrainian attacks on the country’s energy and ports infrastructure. Russia has become India’s biggest crude supplier in recent years, accounting for about half of purchases by state-run refiners.
| Photo Credit:
istock.com
State-owned refiners are rushing to procure spot crude unusually far in advance as Ukrainian attacks on Russian energy assets and a stalemate over the Strait of Hormuz make supplies increasingly uncertain.Processors, including Indian Oil Corp. and Hindustan Petroleum Corp., have already tied up some supplies until October and are now seeking cargoes for as far ahead as November, according to people familiar with the matter. Typically, these companies buy spot supplies just a month or two in advance.The buying spree by the world’s third biggest oil importer underscores mounting concerns over supplies from Russia, which have plunged to the lowest since May after a wave of Ukrainian attacks on the country’s energy and ports infrastructure. Russia has become India’s biggest crude supplier in recent years, accounting for about half of purchases by state-run refiners.Middle Eastern oil exports remain well below normal as peace talks between the US and Iran are deadlocked and a full reopening of Hormuz is uncertain. Hardening positions in Washington and Tehran have dimmed hopes for a breakthrough, while Iran’s attacks on two UAE ships on Friday may further cloud prospects. HPCL bought about 4 million Middle Eastern barrels for October delivery that don’t require passage through the Hormuz, while Mangalore Refinery & Petrochemicals Ltd. booked West African oil arriving in the same month. the country’s biggest refiner Indian Oil is also out to buy October supplies.Indian companies and are preparing to issue more tenders in the coming weeks after having bought some October cargoes, the people said, asking not to be named due to the sensitivity of the matter. Some volumes for November delivery have also been ordered, they added.Spokespeople for Indian Oil, HPCL, MRPL and Bharat Petroleum Corp. didn’t immediately respond to requests for comment.The threat of US sanctions on buyers of Russian oil and gas, including India and China, is also fueling the buying spree. The Senate last week passed legislation authorizing steep tariffs on major purchasers of Moscow’s energy, though the measures have yet to take effect. India has said the bill is the US’s internal matter.State refiners in the South Asian nation meet about half their crude needs through term contracts. They rarely need to commit orders for spot cargoes more than two months ahead given their proximity to major producers in the Middle East and Africa. Also, while Russian crude originates far away, sanctions have left a pool near India available at short notice.The new supply headwinds are emerging just as India heads into the stronger demand season with festivals starting in September. Refining expansions that will add more than 500,000 barrels of daily processing capacity this year will also boost requirements.More stories like this are available on bloomberg.comPublished on August 14, 2026
