State Refiners Plan to Purchase Russian Crude Under a Term Deal

SEATTLE (Oil Monster): According to sources in the Indian Petroleum Ministry, a consortium of state-owned refiners is in talks to acquire oil from Russia under a term contract before the end of the next fiscal year. The transaction is scheduled to be completed by FY26, they said.

The country has been engaging in long-term purchase contracts with its traditional import sources in the Middle East region. Crude oil from Russia is frequently purchased at spot prices, which allows for the acquisition of diverse grades of oil that would otherwise be unavailable.

The term arrangement under discussion is projected to lessen volatility in Russian crude oil prices and give continuous access to Russian crude at reduced prices. It should be recalled that private refiner Reliance Industries Limited (RIL) recently signed an agreement with Russian oil company Roseneft under which it will purchase at least 3 million barrels of oil per month in Russian rubles by 2025.

For more than a year, Russia has been India's major crude import source. However, data published by commodity market analytics firm Kpler indicates that India’s crude imports from Russia fell by 14.5% in August compared to the previous month.