Indian companies will buy less crude oil from Saudi Arabia next month, know what is the reason

264046086india-will-buy-less-oil-from-saudi-arabia.jpg

By: Jeet Ghosh

Last Update: 2021-04-06 21:11:17 IST

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Public sector company Indian Oil Corporation (IOC) and three other refinery companies have decided to purchase only 65 per cent crude oil from Saudi Arabia in May this year against the monthly average of 15 million barrels.

India's refinery companies will purchase less quantity of crude oil from Saudi Arabia next month. The reason for this is that fuel demand has come down due to increasing cases of Kovid-19 infection. On the other hand, in order to diversify the purchase of crude oil, the country's companies are trying to increase the supply from outside of West Asia. 

Public sector company Indian Oil Corporation (IOC) and three other refinery companies have decided to purchase only 65 per cent crude oil from Saudi Arabia in May this year against the monthly average of 15 million barrels. Three people aware of this matter have given this information. 

It is noteworthy that India had urged Saudi Arabia to increase production of crude oil to curb crude oil prices. However, Saudi Arabia did not heed India's request. The Indian government then last month asked public sector companies to focus on supplies from outside of West Asia.

Sources have reported that the IOC and other refinery companies are trying to buy more crude from the spot or the current market rather than a fixed-volume contract from Saudi Arabia or OPEC countries.

Companies have purchased new crude oil from Guyana to Norway as part of their efforts. Indian companies are also eyeing the US to increase purchases. Sources have informed that the IOC has floated a spot tender for the purchase of crude oil from West Africa, the US and Canada.

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