After cutting back on Russian oil imports, Indian Oil Corp., the nation’s biggest refiner, has promised to purchase more Brazilian crude in the fiscal year beginning in April, a company executive said on Tuesday.
Indian Oil increases Brazilian crude purchases
The CEO said reporters outside the Indian Energy Week conference that IOC intends to buy at least 24 million barrels of Brazilian crude between April 2026 and March 2027, up from 18 million barrels the year before.
Shift in sourcing strategy
He stated that the refiner, which recently purchased its first shipments of crude from Ecuador and Colombia, intends to purchase 50% of its oil through term contracts in the upcoming fiscal year. However, he asked to remain anonymous owing to business policy.
Expansion beyond traditional suppliers
Following Moscow’s invasion of Ukraine in February 2022, India emerged as the leading purchaser of cheap Russian seaborne petroleum. However, difficulties caused by Western sanctions eventually led Indian refiners to boost imports from other sources, particularly the Middle East.
Impact of sanctions on Russian oil trade
Under a U.S.-mandated sale, Vitol and Trafigura are offering Venezuelan crude, which Indian refiners are considering importing.
According to the IOC executive, traders are giving Venezuelan crude to Dubai quotations at a discount of $4 to $5 per barrel, which is unappealing because refiners are looking for larger discounts of $7 to $8, comparable to Russian oil offers.
🛢️ Indian Oil Brazilian Crude Plan
- Company: Indian Oil Corp.
- Brazilian Crude Volume: 24 million barrels
- Fiscal Period: April 2026 – March 2027
- Previous Year: 18 million barrels
- Reason: Decline in Russian oil imports
⚠️ Global Crude Pricing Challenges
- Russian Oil: Facing sanctions-related hurdles
- Venezuelan Crude Discount: $4–$5 per barrel
- Desired Discount: $7–$8 per barrel
- Key Traders: Vitol and Trafigura
- Refiner Focus: Cost competitiveness
Frequently asked questions
1. Why is Indian Oil buying more crude from Brazil?
Following a slowdown in Russian imports due to Western sanctions and payment/logistics issues, Indian Oil is diversifying its sources of crude.
2. In FY 2026–2027, how much Brazilian crude would Indian Oil purchase?
Between April 2026 and March 2027, IOC intends to purchase at least 24 million barrels of Brazilian crude, up from 18 million barrels during the prior fiscal year.
3. Why are Indian refiners importing less Russian oil?
Despite the lower price of Russian oil, sanctions have complicated payments, insurance, and shipping, forcing refiners to look for other supplies.
4. Does Indian Oil import crude from other nations?
Yes, IOC recently bought its first shipments of oil from Ecuador and Colombia, indicating a further diversification.
5. Why do Indian refiners not currently find Venezuelan crude appealing?
While refiners are seeking larger discounts of $7–$8, akin to Russian crude transactions, Venezuelan oil is being sold to Dubai at a $4–$5 per barrel discount.
Conclusion
As Russian oil flows decrease due to sanctions-related obstacles, Indian Oil’s move to increase Brazilian crude imports underlines India’s strategic pivot toward supply diversification. Pricing competitiveness is still crucial, even with the exploration of new suppliers like Colombia, Ecuador, and possibly Venezuela.
The action highlights how India’s oil procurement strategy is always changing due to global geopolitics, striking a balance between risk, cost, and reliability.
Disclaimer:
This content is for informational purposes only and does not constitute financial, investment, or energy market advice. Figures and statements are based on available reports and may change.
