 "India may raise Saudi oil purchases after pulling away from Russian crude")
India oil imports, Saudi Aramco supply, Russian crude decline, Asia oil demand, OPEC supply increase, India energy shortfall, China Saudi oil cuts, refinery maintenance China, Indian refiners Russian oil, global crude markets
India will be among Asian buyers taking more oil from Saudi Aramco next month after pulling away from Russian crude, though the modest rise has left traders wondering how the world’s third-largest importer will fill a shortfall of up to 1.2 million barrels a day.
China, meanwhile, has surprised traders by reducing Saudi imports, a drop some attributed to planned refinery maintenance at a state-owned company and more purchases from other regions such as the Americas.
At least 18 to 20 million more barrels were sought by customers across India, Japan, South Korea and Taiwan for December compared with this month, as Saudi’s selling prices were deemed attractive, according to people familiar with the sale, who asked not to be named as they’re not authorized to speak publicly. Sales to China dipped by close to four million barrels.
India’s purchases rose about five million barrels month-on-month, they added. The requests were met by Aramco. Still, the amount is only a fraction of what the country needs to fill the gap left by Russian oil after US pressure and sanctions — five out of seven refiners have said they would steer clear of Moscow’s crude.
At least one refiner has said it would still take Russian imports, as long as supplies are from non-sanctioned sellers. But with a trade deal nearing — and with it, the potential removal of a punitive tariff imposed over oil purchases from Moscow — it is unclear how much India will actually purchase.
The overall jump in sales comes as Saudi Arabia is leading the Organization of the Petroleum Exporting Countries and its allies in raising supply to regain market share. Traders remain skeptical of the increase in volume on the ground, however. The group agreed last week to revive 137,000 barrels a day of production next month, matching increases in October and November. It will then pause increases in the first quarter of next year.
With assistance from Rakesh Sharma and Nicholas Lua.
(Adds detail on India’s buying in paragraphs four and five.)
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