Indian Oil Corporation
Indian Oil Corporation
Indian Oil Corporation : Rosneft and Indian Oil have yet to extend their oil supply contract, which expired in March after India’s largest refiner failed to agree on prices and production and was forced to turn to the spot market. Three sources familiar with the matter said this on Monday.
IOC and Rosneft extended their second annual oil contract a year ago. The agreement was first signed during Russian President Vladimir Putin’s visit to India in December 2021, months before Russia’s military action in Ukraine.
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State-run IOC’s term contract with Rosneft expired on March 31, two sources said.
“The contract for 2024-2025 has not been renewed,” the source said.
The IOC and Rosneft can still sign the agreement if they agree to the terms, but in the meantime the Indian company will buy Russian oil on spot markets, two sources said.
Indian Oil Corporation : New Delhi has been gorging on Russian oil sold at a discount after Western nations shunned purchases and imposed sanctions on Moscow over its invasion of Ukraine, with Russia becoming the top supplier to the world’s third largest importer.
IOC’s annual oil purchase contract with Rosneft provided monthly supply of 1.5 million metric tons (360,000 barrels per day) at a discount of $8-$9 per barrel to Dubai quotes on a delivered basis.
IOC and other state refiners Bharat Petroleum Corp and Hindustan Petroleum Corp were jointly negotiating with Rosneft for up to 400,000 barrels per day of oil in a yearly contract from April 1, sources previously told Reuters.
But Rosneft offered four to six deliveries per month, or up to four million barrels in total, which was well below what Indian refiners were collectively seeking, according to two sources.
According to two sources, Rosneft offered discounts of between $3 and $3.50 a barrel to Dubai prices under temporary contracts, similar to those on the spot market.
Rosneft, IOC, BPCL and HPCL did not respond to requests for comment.
India has continued to buy Russian oil despite problems posed by a raft of sanctions.
However, Indian state refiners decided against lifting Russia’s light sweet Sokol grade oil during joint negotiations with Rosneft due to payment problems.
IOC is still struggling to make payment for three Sokol oil cargoes purchased last year, the two sources said.
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