NEW DELHI/SINGAPORE: Indian Oil Corp, the country’s top refiner, has bought five cargoes of Russian oil for December arrival from non-sanctioned entities, traders said, resuming purchases despite pressure from Washington on India to stop buying Russian oil.
Washington last week imposed sanctions on Rosneft and Lukoil, Russia’s two largest oil companies, stepping up efforts to pressure President Vladimir Putin to end the war in Ukraine.
Since then, many Indian refiners including state-run Mangalore Refinery and Petrochemicals Ltd, HPCL-Mittal Energy Ltd and Reliance Industries, operator of the world’s biggest refining complex, have paused buying Russian oil.
IOC’s head of finance, Anuj Jain, however, has said his company will continue to buy Russian oil if the barrels are in compliance with sanctions.
The European Union, the UK and the U.S. have imposed a raft of sanctions against Russia for the Ukraine war, including on shipping.
The sanctions have forced Russia to sell its oil at heavy discounts, and over the past three years India has become the biggest buyer of Russian seaborne crude.
IOC has bought about 3.5 million barrels of ESPO at about parity to Dubai quotes for delivery at an eastern Indian port in December, one of the trade sources said. The sources did not say who the sellers were.
IOC did not immediately respond to a request for comment outside working hours.
The refiner had previously cancelled seven or eight cargoes of Russian oil after the announcement of the latest U.S. sanctions as they were supplied by subsidiaries of sanctioned entities, two sources said. The sources declined to be named due to the sensitivity of the issue.
Before the latest U.S. sanctions, Rosneft was a major seller of ESPO oil.
Most Russian ESPO crude from the Pacific port of Kozmino has typically gone to China. However, demand from China has dropped after state refiners suspended purchases following U.S. sanctions, while Chinese independent refineries have exhausted their import quotas.
As a result, the price of ESPO crude has declined, making it attractive for Indian buyers.
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