Indian Oil Buys Its First Norway's Johan Sverdrup Crude Cargoes: Report

According to two trade sources, India's state-run refiner Indian Oil Corporation (IOC) has made its first procurement of Norway's Johan Sverdrup crude, purchasing four million barrels through a tender as it aims to diversify its crude imports.

According to one of the reports, IOC will receive two million barrels of North Sea crude in each of May and June 2021. More information on the trade deal was not available.

In an ongoing stand-off between India, the world's third-largest crude importer, and Saudi Arabia, the de-facto leader of the Organization of Petroleum Exporting Countries, the move follows the Indian government's call to minimise reliance on Middle Eastern crude.

According to Reuters, state refiners such as IOC, Bharat Petroleum Corp, Hindustan Petroleum Corp, and Mangalore Refinery and Petrochemicals Ltd. seek to reduce oil imports from Saudi Arabia by May 2021.

In late 2019, oil from Johan Sverdrup, the largest North Sea discovery in over three decades, continues to come to Asia's top oil importers, with India's Reliance IOC being the first taker.

Although the grade has gained attention among Chinese independent refineries, trade flows data on Refinitiv Eikon show that it is rarely supplied to India.

According to the results, India last discharged a one-million-barrel cargo of Johan Sverdrup crude in September 2020.

Due to seasonal refinery maintenance and a massive influx of Iranian oil, Chinese refiners have reduced crude purchases in the spot market, putting pressure on global oil sellers.

In the meantime, as they diversify away from Middle Eastern oil, Indian refiners are looking at crude from the US, West Africa, South America, and the Mediterranean, according to trade sources.

HPCL-Mittal Energy loaded India's first cargo of Liza light sweet crude from Guyana last month.

According to a trade source, another state refiner, BPCL, purchased three million barrels of US light sweet grades, including West Texas Intermediate Midland and Eagle Ford, for delivery in May.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.