India’s Top Refiner Shops for Oil Again After Month-Long Hiatus

Storage tanks stand at an Indian Oil Corp. facility near Jawaharlal Nehru Port, Navi Mumbai. (Photographer: Dhiraj Singh/Bloomberg)

India’s Top Refiner Shops for Oil Again After Month-Long Hiatus

India’s biggest oil refiner is shopping for crude oil again after a one-month gap, offering a hope that the Asian country’s demand hasn’t been stalled by spiraling cases of coronavirus.

Indian Oil Corp., which hadn’t tendered for shipments since about mid-April, returned to the market on Thursday, issuing three purchase orders for cargoes from multiple regions. Traders of West African crude, from where IOC often sources its crude via tenders, said the scale of the company’s actual purchases will dictate whether the move is bullish or not.

Crude has been piling up in West Africa in recent weeks in part because of diminished purchases from India, where multiple states and regions have entered into lockdowns to combat the spread of the virus and refineries have trimmed processing rates. IOC’s prolonged absence from the market had been viewed by traders as a bearish signal, given India’s status as the world’s third-largest oil importer.

IOC is seeking barrels for June and July loading. The fact it’s seeking June consignments at a later than usual stage might be a sign that the company had been holding back to gage the impact of the country’s fuel demand slump, traders said.

The company could now opt to buy consignments for loading next month at discounted prices. Purchases for July loading may offer a signal as to whether the company could resume its typical buying pattern for the next trading cycle, or if buying may remain lower than usual, they added.

©2021 Bloomberg L.P.

BQ Install

Bloomberg Quint

Add BloombergQuint App to Home screen.