In­dia buys first US sweet crude, deals threaten Nige­ria mar­ket

Daily Trust - - NEWS - By Daniel Adugbo with agency re­port

In­dia’s state-run re­finer Bharat Petroleum Corp Ltd (BPCL) bought one mil­lion bar­rels of US crude oil grade, the West Texas In­ter­me­di­ate (WTI) Mid­land sweet crude, for de­liv­ery in Oc­to­ber, mak­ing it BPCL’s first pur­chase of the sweet va­ri­ety from the US.

En­ergy news provider, Platts, quoted trade and oil min­istry sources that BPCL bought the cargo via a ten­der floated last month at a cheaper price. Last week, BPCL also bought 1 mil­lion bar­rels of crude via a spot ten­der.

Dur­ing the first half of July, BPCL bought 500,000 bar­rels of va­ri­eties of medium-to­high-sul­fur crude for de­liv­ery to its re­finer­ies.

An­other In­dia staterun re­fin­ery, Hin­dus­tan Petroleum Corp. Ltd. (HPCL) also has plans to im­port US sweet crude in the next few months for its re­finer­ies. HPCL’s two re­finer­ies in Mumbai and Vizag can take up to 2 mil­lion bar­rels/month of US crude.

The deal made IOC the first state-run re­fin­ery in In­dia to buy US crude.

It could also deal a blow to Nige­ria whose num­ber one crude oil ex­port des­ti­na­tion is In­dia.

In­dia’s IOC buys some 8 mil­lion tons of crude oil from Nige­ria; most of it light sweet and they are bought from spot mar­kets where prices are sub­ject to ex­treme volatil­ity.

The re­cent OPEC/nonOPEC cuts have meant that In­dia had to di­ver­sify its crude sup­pli­ers.

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