NEW DELHI: India’s oil imports from Iraq plunged to a 20-month low in October as refiners continued to buy discounted Russian barrels and boosted purchases of West African crude, preliminary tanker arrival data obtained from trade sources showed.
The world’s third-biggest oil importer and consumer bought 907,500 barrels per day (bpd) of oil in October from its top supplier Iraq, a decline of 9.6% from a year earlier and the lowest since February 2021, the data showed.
India’s oil imports from No. 2 supplier Russia also slowed in October as Nayara Energy, part owned by Russian oil major Rosneft, reduced purchases ahead of maintenance at its refinery from this month, the data showed.
Refiners in India have been snapping up Russian barrels at a discount after some Western governments shunned purchases from Moscow following its late-February invasion of Ukraine.
New Delhi has not yet publicly condemned Moscow’s special military operation in Moscow and has maintained that Asia’s third-largest economy needs cheaper oil to cut its import bill and shield customers from high energy costs.
India will continue to buy Russian oil as it benefits the South Asian nation, foreign minister S. Jaishankar said on Tuesday, days ahead of the U.S. Treasury Secretary’s visit to New Delhi for talks on issues including a cap on Russian oil prices.
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Overall, India shipped in 4.48 million bpd of oil in October, up 14.6% from September, when imports were low due to maintenance work at some refineries.
“Iraq and Saudi supplies to Europe have gone up significantly, which leaves lower volume to Indian refiners for whom Iraqi crude was proving to be exceptionally expensive compared to Russian oil,” said Ehsan Ul Haq, a Refinitiv analyst.
India’s imports from Saudi Arabia, which remained its No. 3 supplier, fell to a four-month low of 661,400 bpd in October, the data showed.
A narrower price spread between Brent and Dubai, also known as Exchange For Swaps, in August and September offered some Indian refiners an opportunity to buy better quality West African grades, said Haq.
West African oil is priced against Atlantic Basin benchmark dated Brent, whose values have narrowed against Middle East marker Dubai.
The Middle East’s share in India’s overall monthly imports fell marginally to 55%, while that of C.I.S. nations reduced to about 22.5% from 28%. In contrast, African grades accounted for about 12% of India’s imports, rising from 7%.
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