Mideast oil gains Indian market share over African grades
India’s oil imports from the Middle East hit an eight-month high in October after producers reduced official selling prices (OSP) while its purchases of African crude fell to a three-month low, data obtained from sources showed.
Refiners in India, the world’s third biggest oil importer and consumer, have diversified crude imports to improve margins.
Middle Eastern oil imports in October rose 27% from the previous month to 2.7 million barrels per day (bpd) while African imports declined 39% to 439,300 bpd, the data showed.
Imports from Latin America rose 89%, due to higher purchases of Venezuelan oil by Reliance Industries.
“Middle Eastern producers had cut October OSPs to regain market share, resulting in higher flows to India, where refiners were raising runs expecting higher fuel demand ahead of the festive season,” said Ehsan Ul Haq, an analyst at Refinitiv.
He said compared to other grades Middle East oil yields more fuel oil, cracks for which have been recovering from mid-October.
Indian Oil Corp, the country’s top refiner, is operating its plants at 100% capacity, IOC Chairman S.M. Vaidya said recently.
India’s October fuel consumption - a proxy for oil demand - rose above pre-pandemic levels for the first time in eight months. [O/INDIA2]
India’s overall oil imports rose 16.5% from the previous month to 4.05 million bpd in October, the data showed.
The share of OPEC oil including supplies from the Neutral Zone, whose production belongs to Kuwait and Saudi Arabia, fell slightly to 75%, putting its average share for the first seven months of this fiscal year to March at 74.5%.
Last month Iraq remained the top oil supplier to India followed by Saudi Arabia, United Arab Emirates and Nigeria. Kuwait which was the 10th largest supplier in September, rose to fifth followed by Venezuela and the United States.