Major Indian state refiner BPCL eyeing Russian oil for long term

Bharat Petroleum Corp. will consider buying Russian oil under long-term contracts as India strengthens its relationship with the OPEC+ producer.

India’s second-biggest state-run refiner will assess long-term arrangements with Russia when it starts negotiating with producers this month for contractual supplies, said a BPCL official who asked not to be identified as the information is private. The official spoke on the sidelines of India Energy Week.

The South Asian nation has become a key outlet for Russian crude since the invasion of Ukraine almost a year ago, processing the oil into fuels that have been shipped to Europe and the US. BPCL currently buys Russian oil on a one-off spot basis. It doesn’t have any long-term deals and will be negotiating supply for April to March 2024.

Russian crude has the potential to make up 22 percent of BPCL’s spot intake based on refinery configurations, according to the official. The grades currently make up about 20 percent. The company’s annual oil consumption is around 40 million tons, of which close to 90 percent is imported, the official said.

India’s Oil Minister Hardeep Singh Puri said this week that the nation intends to harness its growing buying power to secure favorable deals. OPEC’s Secretary General has invited the Indian minister to the producer group’s next meeting, Puri said on Wednesday.