Offers of Venezuelan crude to India are limited, and in small volumes, as most of the oil under U.S. control is heading to the United States, Indian refining executives told Reuters.
Since the U.S. took control of Venezuela’s oil sales and authorized two of the world’s biggest independent traders, Vitol and Trafigura, to market the crude, Indian refiners have vied for crude from Venezuela as they seek to diversify the large exposure to Russian crude they had amassed over the past three and a half years.
Indian Oil Corporation, Hindustan Petroleum Corp (HPCL), Mangalore Refinery and Petrochemicals Ltd (MRPL), and Reliance Industries have been willing to buy crude from Venezuela since the U.S. said it would sell Venezuela’s oil. But the Indian refiners haven’t been top of the list of potential buyers for Vitol and Trafigura.
“Offers are not there. Traders are looking to meet their commitment to the U.S. market,” an anonymous executive told Reuters.
All Indian refiners have said they would comply with the U.S. sanctions on Rosneft and Lukoil, and Russian supply to India has now plunged to a three-year low.
As a result, Indian refiners have scoured the globe for supply and have sourced more crude from the Middle East, West Africa, and the Americas to replace part of the lost Russian barrels.
Meanwhile, Vitol and Trafigura have sold Venezuelan crude to U.S. refiners Valero and Phillips 66, as well as to Spain’s Repsol, and to the Saras refinery in Italy owned by Vitol.
At the request of the US government, Trafigura and Vitol are providing logistical and marketing services to facilitate the sale of Venezuelan oil, Trafigura said early this month, following a meeting of oil industry executives with U.S. President Donald Trump at the White House.
Since then, Vitol and Trafigura have started offering Venezuelan crude to refiners in China and India for March delivery, but U.S. customers are a priority for the sales of the oil under U.S. control.
By Charles Kennedy for Oilprice.com
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