The Indian Nayara buys the Urals after 1 year; The IOC reserves an additional 3 million barrels

  • Nayara Energy buys 1.8 million barrels from Urals
  • Indian Oil Corp again buys 3 million barrels from Urals

NEW DELHI, March 23 (Reuters) – India’s private refiner Nayara Energy, part-owned by Russia’s Rosneft (ROSN.MM), bought Russian oil after a year-long hiatus, buying about 1.8 million barrels of ‘Urals to trader Trafigura, two trade sources said and Refinitiv data shows.

Indian companies are grabbing Russian oil because it is available at a huge discount after some companies and countries avoided buying from Moscow due to sanctions over its invasion of Ukraine.

Indian Oil Corp (IOC.NS), the country’s top refiner, also bought 3 million barrels of Russian oil on Wednesday through a tender for May loading from trader Vitol, traders said. This is IOC’s second purchase of Russian oil this month. Read more

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India, the world’s third-largest oil consumer and importer, has also not banned imports of Russian oil, unlike several Western countries. Read more

The Nayara deal, struck after Russia launched what it calls a ‘special operation’ in Ukraine on February 24, involves the use of the Liberian-flagged Aframax Moskovsky Prospect, operated by a unit of the company Russian shipping company Sovcomflot (FLOT.MM), Refinitiv data display.

Sovcomflot was blacklisted by the United States last month. Britain and Canada have also banned Russian-flagged, operated or owned ships from docking in their ports.

Nayara, in which trader Trafigura and Russian investment group UCP also have a stake, operates a 400,000 barrel per day refinery in Vadinar, in the western state of Gujarat, and previously bought the Urals in March 2021 , according to data from Refinitiv.

Freud, flying the flag of the Marshall Islands, operated by TMS Tanker Ltd and carrying around 1.14 million barrels from the Urals, will reach Vadinar on March 30, while Moskovsky Prospect loaded with 725,380 barrels is expected to arrive on April 17, according to the flow Refinitiv.

No response was available from Svocomflot, while Trafigura and Nayara did not comment on the deal citing confidentiality.

“Like any other refinery, Nayara Energy has ongoing crude supply agreements to optimize its crude basket with the aim of securing the best option for our refinery,” he said.

Trafigura said it would meet its legal obligation under forward agreements signed before the war in Ukraine.

India rarely bought Russian oil in the past due to high freight costs.

Oil Minister Hardeep Singh Puri said last week that India was in talks with Russian authorities to buy oil and was assessing issues related to insurance, freight and payment.

India has called for an end to violence in Ukraine but refrained from outright condemnation of Russia, with which it has long-standing political and security ties.

Earlier this month, Hindustan Petroleum (HPCL.NS) also bought Russian oil on delivery at steep discounts through tenders. Read more

While state refiners have bought Russian oil at steep discounts through tenders, for Nayara the discount on oil purchases is “not much”, the sources said.

(Corrects that Russian investment group UCP has a stake in Nayara Energy, not VTB Bank, in paragraph 7)

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Reporting by Nidhi Verma; Editing by Stephen Coates and Shailesh Kuber

Our standards: The Thomson Reuters Trust Principles.

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