HPCL Taps West Africa For Crude Supply To Its Rajasthan Refinery

State-run refiner Hindustan Petroleum Corporation Limited (HPCL) has picked up two million barrels of crude from West Africa for its Rajasthan refinery, a facility with a processing capacity of 180,000 barrels per day. The purchase was made through a tender, Reuters reported.

Trading firm Glencore supplied the crude, comprising Nigeria's Okwuibome and Utapate grades, for HPCL Rajasthan Refinery Ltd (HRRL), the report said. Shipment is scheduled to reach India by late September, though details of the deal's value were not disclosed. HRRL is majority owned by HPCL, which holds a 74% stake, with the Rajasthan government holding the balance.

IOC Leans On Spot Market

In a separate development, Indian Oil Corporation (IOC) turned to the spot market for a record portion of its crude purchases in the April-June quarter, as the US-Iran conflict disrupted the usual flow of supplies from West Asia, according to an earlier Bloomberg report.

The company's Finance Director Anuj Jain told analysts that spot deals accounted for as much as 84% of the company's crude sourcing during the quarter. The shift also pushed up IOC's dependence on Russian oil, which made up 54% of its imports in the same period. Under normal circumstances, roughly half of IOC's crude needs are met through long-term agreements, largely with producers in the Gulf.

Kpler data showed IOC imported close to 1.4 million barrels of crude daily during the quarter, making up about 27% of India's total overseas crude purchases.

Company Chairman Arvinder Singh Sahney, speaking at a media briefing on Friday, said IOC expects to revert to its earlier sourcing pattern once shipping disruptions near regional choke points ease. Gulf producers, he noted, continue to offer the most dependable long-term supply given their proximity.

Jain also pointed to upcoming capacity additions at the company's Panipat, Barauni and Gujarat refineries, which are together expected to add 347,000 barrels per day by December, further pushing up crude demand.

Fuel Retailers Report Smaller Losses

Meanwhile, the country's three state fuel retailers, IOC, Bharat Petroleum Corporation and HPCL, posted a combined net loss of ₹18,149 crore for the April-June quarter. The figure represents a steep decline from profits recorded a year earlier, though it came in well below the government's own projection of losses tied to below-cost fuel sales during the West Asia crisis.

The actual loss was far smaller than the ₹78,481 crore Petroleum Minister Hardeep Singh Puri had estimated last month for the same period, when crude prices surged following the US-Iran standoff.

Puri had made the comments on July 2, while addressing questions on whether pump prices would be cut after crude values dropped in the wake of a ceasefire between Iran and Israel brokered by the United States. He said the losses reflected the government's effort to protect consumers from a spike in global crude prices.