Indian Oil Looking For Annual Deal To Buy Oil From US

The top refiner of country, Indian Oil Corporation, is looking for an annual deal to buy US crude as it seeks to broaden its oil purchasing options, its chairman said on Wednesday, amid uncertainties over imports from Iran.

Washington in November granted a six-month waiver to Delhi from sanctions against Tehran and restricted India’s monthly intake of Iranian oil to 1.25 million tonnes or 300,000 barrels per day. Sanjiv Singh told reporters IOC has not yet finalised from which company it would buy US oil.

“When we go for term, it should have price advantage for us and strategic advantage for us apart from supply sureties. So considering these three we will work out volumes also,” he said.

India Oil had previously purchased US oil from spot markets and signed a mini-term deal in August to buy 6 million barrels of US oil between November to January.

IOC is the country’s top buyer of Iranian oil with an annual contract for 180,000 bpd in the fiscal year ending March 2019.

Mr Singh said his firm buys Iranian oil because of competitive prices and attractive terms and conditions. Iran offers extended credit periods and almost free shipping on oil sales to India.

He said IOC was in talks to renew an annual oil contract with Iran but a new any deal would depend on conditions attached to a subsequent waiver from the US sanctions.

“The earlier waiver was for the existing contract, (for a new contract) we will have to work it out,” Sanjiv said. Meanwhile, the refiner has signed a deal with Iraq to buy 360,000 bpd of oil, including up to 500,000 bpd of Basra Heavy, in 2019 compared with 356,000 bpd last year.