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India Refiners Shun Russia, Eye Persian Gulf Crude
26 Oct
Summary
- India shifts to Persian Gulf crude due to high shipping costs.
- Long-haul Russian shipments become economically unviable.
- Discounted Iraqi crude offers an attractive alternative.
Indian oil refiners are actively changing their crude sourcing strategies, with a notable pivot towards the Persian Gulf. This redirection comes as escalating freight charges significantly undermine the financial viability of long-haul oil shipments, particularly from Russia, a once-primary supplier.
The economics of importing crude are being re-evaluated due to the high cost of transportation. This situation is exemplified by the procurement of Iraqi oil. Some shipments of Iraqi crude are currently being offered at substantial discounts, exceeding $25 a barrel relative to the Dubai benchmark, even before factoring in shipping expenses.
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