LatAm-to-India crude shipments rise again
Indian refiner Hindustan Mittal (HMEL) booked the Suezmax Yamuna Spirit to carry a shipment of crude oil from the east coast of Mexico to Mundra, Gujarat, starting 2 September, marking the company’s first Latin American crude purchase as part of a larger movement to bring a more diverse crude slate to India.
State-controlled refiners in India started buying crude in June to fill the new 9.8mn bl strategic reserve in Visakhapatnam. The country is planning to bring on line more strategic reserve capacity at Mangalore and Padur in October, taking storage capacity to around 36mn bl.
Additionally, the Indian government has been asking state refiners to reduce their dependence on term purchases and shift to spot cargoes because spot prices are currently lower and because Indian refiners have been upgrading their plants to run heavier grades.
Mangalore Refining and Petrochemicals (MRPL) was already heard purchasing 1mn bl of Argentina’s heavy sweet Escalante crude for October delivery to Mangalore. HMEL’s purchase is expected to take about 45 days to travel to the Asia-Pacific region.
India’s private-sector Reliance Industries scheduled three other crude tankers this week to travel from Latin America to India during late August through September, and state-owned Essar Oil booked a VLCC last week to make the route starting 10 September.
The last uptick of crude vessels trekking this distance was in early March, when India was importing more crude from Latin America to replace expected crude receipts from Iraq that were lost when high winds were delaying tankers by several weeks.