India’s crude buying strategy is shifting again. State-run Bharat Petroleum Corp Ltd has made its first-ever purchase of Venezuelan oil, while private refiner HPCL Mittal Energy Ltd (HMEL) has bought crude from the South American nation for the first time in two years, three sources familiar with the deal told Reuters on Wednesday.
According to the sources, both refiners purchased one million barrels each of Venezuela’s heavy Merey crude grade. The cargoes were bought through global trader Vitol. Pricing details were not immediately available.
To reduce freight costs, the two cargoes will be co-loaded on a very large crude carrier. The purchases are expected to lift India’s imports of Venezuelan oil to at least six million barrels through April.
BPCL and HMEL did not respond to Reuters’ requests for comment. Vitol declined to comment.
DIVERSIFYING AWAY FROM RUSSIA
The renewed interest in Venezuelan crude comes as Indian refiners adjust their supply mix. Traders say refiners have been cutting back on Russian oil purchases, a move that has coincided with efforts by New Delhi to clinch an interim trade deal with Washington.
HMEL, a joint venture between Hindustan Petroleum Corp Ltd and steel tycoon Lakshmi Niwas Mittal, last received Venezuelan oil in February 2024, according to trade flow data from LSEG and Kpler. The company suspended Russian oil imports in October.
While India has not officially announced a halt to Russian imports, refiners have been avoiding fresh Russian cargoes in recent months, sources said.
Other Indian refiners, including Reliance Industries Ltd and Indian Oil Corp, have previously bought Venezuelan crude at discounts of about $6.5 to $7 per barrel below the Dubai benchmark.
DELIVERY PLANS
BPCL plans to split its cargo between Kochi port in Kerala for its 310,000-barrel-per-day Kochi refinery and Sikka port in Gujarat for its 156,000-bpd Bina refinery.
HMEL will route its shipment through Mundra port in Gujarat to feed its 226,000-bpd Bathinda refinery in northern India.
Venezuelan crude has been marketed by traders including Vitol and Trafigura since January under US licenses tied to a broader supply arrangement between Caracas and Washington.
At the same time, exports of Venezuelan oil to the United States are also expected to rise. Reuters has reported that US refiner Valero Energy is set to receive up to 6.5 million barrels in March, while Chevron has ramped up shipments from the country.
With inputs from Reuters
