India's Bharat-Oman buys first US crude
Singapore, 19 September (Argus) — Indian joint-venture refiner Bharat-Oman Refineries (Borl) has bought its first ever cargo of US crude amid growing imports from the US Gulf coast by Indian refiners this year.
Borl bought 1mn bl of Mars crude from trading firm Trafigura through a tender that sought cargoes for 16-25 November-arrival on a cif or des basis. The tender, which closed on 15 September, listed US Mars and Poseidon crude along with grades from the Mideast Gulf, Latin America and west Africa.
Shutdowns and disruptions to refineries after Hurricane Harvey hit the US Gulf coast at the end of August reduced domestic demand for domestic crude. The lower demand saw a drop in US crude prices that may have contributed to imports from the US Gulf coast becoming competitive for Indian refiners.
Mars fell to a $3.39/bl discount to Oman at the Asian timestamp on 30 August, down from a discount as narrow as $2.33/bl in the week before Hurricane Harvey hit.
Borl typically buys shorter haul crude from the Mideast Gulf. In its previous two tenders it bought 1mn bl of Russian Urals crude for September delivery and 1mn bl each of Oman and Iraqi Basrah Light crude for early October delivery.
Borl's purchases follows Indian state-controlled refiners IOC and Bharat Petroleum that have bought US crude following a meeting between US President Donald Trump and Indian prime minister Narendra Modi at the end of June. The Indian government has encouraged state-controlled refiners to buy US and Canadian crude from the US Gulf coast by allowing to them to buy a portion of their crude requirements every month on a delivered basis, allowing refiners to use a foreign rather than an Indian-owned vessel for the purchase. Indian refiners typically have to use domestic vessels for their crude imports.