Media reports Indian state oil refiners presently looking for long-term agreements with Russia
Date
9/23/2024 8:25:03 AM
(MENAFN) India's state-owned oil refiners are currently negotiating long-term supply agreements with Russia, as reported by Business Standard, citing sources within the Ministry of petroleum and Natural Gas. These agreements are expected to be finalized by next April, coinciding with the start of the new fiscal year.
As the world's third-largest consumer of crude oil, India relies heavily on imports, sourcing up to 85 percent of its crude needs. Russia has emerged as India's primary oil supplier, playing a crucial role in bolstering the nation’s energy security. While private Indian refiners have already established annual contracts for Russian oil, state-owned companies have typically engaged in spot market purchases, opting for long-term contracts mainly with suppliers from the Middle East.
However, recent fluctuations in spot prices have prompted state refiners to reconsider their strategies. Ministry sources indicate that securing long-term contracts with Russia would mitigate the risks associated with price volatility, ensuring a consistent supply of oil at more stable and potentially lower prices.
India has significantly increased its Russian crude imports since the onset of the Ukraine conflict in 2022, taking advantage of substantial discounts offered by Moscow as it lost its traditional Western buyers due to sanctions. This shift in sourcing aligns with India's broader strategy to enhance energy security while navigating geopolitical challenges.
By pursuing long-term agreements, Indian state refiners aim to create a more reliable supply chain, ultimately reducing dependence on volatile spot markets and strengthening their energy procurement framework in an increasingly uncertain global landscape.
MENAFN23092024000045015687ID1108704077
Legal Disclaimer:
MENAFN provides the information “as is” without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the provider above.