India’s state-owned Bharat Petroleum (BPCL) has made its first purchase of West Texas Intermediate (WTI) crude oil via a tender, according to a new report by Reuters.
The shipment of the American crude grade should reach Indian shores by October, an industry source close to the matter said.
Indian refiners are in the process of diversifying their crude sources as OPEC leaders attempt to cut back exports to increase oil prices internationally.
Other Asian countries – including South Korea, Japan, China, Thailand, Australia, and Taiwan – have already started an oil import relationship with American supplies. India is late to the party, comparatively.
OPEC’s November deal to cut output by 1.2 million barrels per day caused prices of Saudi Arabian, Iranian and Iraqi heavy crude grades to jump.
BPCL made its first ever purchase of U.S. crude oil last month, when it ordered high sulphur Mars and Poseidon crudes for its refineries. Indian Oil Corp., the country’s top refiner, was the first Indian company to purchase US crude, purchasing 1.6 million barrels of Mars crude earlier in July.
Both deals follow a visit last month by India’s PM Narendra Modi to the U.S., at which President Trump said that the United States is looking to expand its international reach by starting oil and gas exports to India. The price of the U.S. sour crude blends that Indian refineries are showing an appetite for is “reasonably competitive,” according the Bharat Petroleum’s head of refineries, R Ramachandran.
The US-India energy cooperation doesn’t stop there—it also includes Indian energy companies signing more than US$30 billion in long-term contracts for U.S.-produced liquefied natural gas, including from Louisiana and Maryland, and an upcoming trade mission of U.S. technologies that can optimize the performance of India’s oil refineries.
By Zainab Calcuttawala for Oilprice.com
More Top Reads From Oilprice.com:
Zainab Calcuttawala is an American journalist based in Morocco. She completed her undergraduate coursework at the University of Texas at Austin (Hook’em) and reports on…