Indian Oil Cos To Cut Oil Import From Saudi Arabia By A Quarter In May Amid OPEC Production Cut
Following the decision of Organisation of the Petroleum Exporting Countries (OPEC) and its allies (OPEC+), agreeing to extend production cuts into April, Indian State refiners have decided to cut their oil imports from Saudi Arabia by a quarter in May.
As reported by Reuters, Indian Oil Corporation (IOCL), Bharat Petroleum Corporation(BPCL), Hindustan Petroleum Corporation Limited (HPCL) and Mangalore Refinery and Petrochemicals Limited(MPCL) are preparing to lift about 10.8 million barrels in May, the sources said on condition of anonymity.
Concerned with the rising oil prices, Petroleum Minister Dharmendra Pradhan had urged OPEC and OPEC+ to phase out supply curbs but to no avail.
The report further adds that Saudi counterpart Prince Abdulaziz bin Salman suggested that India should dip into strategic reserves filled with cheaper oil bought last year.
Meanwhile, the oil nominations for April had already been placed with OPEC+ by Indian refiners. Saudi Arabia has maintained its average monthly oil supply to India but has cut supplies of other Asian refiners.
The petroleum ministry has asked the state refiners to diversify their crude sources and lessen the dependency on the Middle East, following Saudi kingdom's rejection for extra supplies.
India refines about 5 million barrels per day (bpd) of which state refiners control 60 per cent.
State refiners import about 14.8 barrels of Saudi Oil in a month, but the Middle East share of Indian oil imports has already tanked to a 22-months low in February.
Saudi Arabia is the world's largest oil producer. Still, it has slipped to fourth place as India's oil supplier, with Iraq and the United States or America occupying the top two positions.
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