Indian refineries, including Indian Oil Corp. and Hindustan Petroleum Corp., have purchased 2 million barrels of Merey crude from Venezuela for delivery in the second half of April. The crude will be carried on a very large crude carrier, with IOC taking about 1.5 million barrels and HPCL about 500,000 barrels, and is scheduled to arrive at the Indian east coast.
Indian Venezuelan oil purchase highlights the refineries’ effort to diversify their sources and replace Russian oil with a similar source. This decision followed India’s decision to avoid purchasing Russian oil to help New Delhi secure a trade deal with Washington. HPCL and IOC are the first Indian refineries to purchase Venezuelan oil, having done so in 2024. Â
In January, HPCL said it was considering processing Venezuelan oil at its 300,000-barrel-per-day refineries in Vishakapatnam, in the southeastern state of Andhra Pradesh, which were recently upgraded to process heavy oil. This is because the crude from Venezuela has a much higher density and is not suitable for all refineries. Similarly, IOC previously processed Merey at its Paradip refinery in the eastern state of Odisha.
Recently, Reliance Industries also bought 2 million barrels of Venezuelan oil for April delivery from Vitol. They paid about $6.50 to $7 less per barrel than the ICE Brent price. IOC and HPCL also purchased Venezuelan oil, but from Trafigura. US Gulf Coast oil refineries are struggling to handle the sudden surge in Venezuelan oil shipments, leaving some oil unsold.
