MOSCOW (MRC) -- At least two Indian refiners plan to buy less Saudi oil than usual in May, after the kingdom raised the official selling price to record highs for Asia, as India increases purchases of cheap Russian crude, reported Reuters.
India, the world's third biggest oil importer and consumer, has been hit hard by rising crude values, with pump prices in some states touching record highs.
State oil producer Saudi Aramco, the world's top oil exporter, has raised crude prices for all regions, with those to Asia hitting all-time highs.
The Middle East accounts for the bulk of India's oil imports, with Iraq and Saudi Arabia the top two suppliers to Asia's third largest economy.
The sources at the two Indian refiners declined to be named, citing confidentiality.
They did not disclose the volumes refiners would buy, and said the reductions in May would be marginal because they have to lift the amount they have committed to under annual contracts.
To mitigate the rising cost of oil imports, India has turned to Russian barrels that are available at a deep discount to the dated Brent benchmark, citing "national interests".
Some companies and countries have shunned Russian crude after the country began its invasion of Ukraine on Feb. 24.
Indian refiners have bought at least 16 MM barrels of cheaper Russian oil for May loading on a delivered basis, similar to purchases for the whole of 2021, according to Reuters calculations.
The companies have mostly bought Russian Urals, a grade similar in quality to medium sour crude produced in the Middle East and West Africa, mainly Angola.
As MRC informed before, in mid-March, 2022, Indian Oil Corp, the country's top refiner, bought 3 mln bbl of Russian Urals from trader Vitol for May delivery, its first purchase of the grade since Russia invaded Ukraine. Western sanctions against Russia have led many companies and countries to shun its oil, depressing Russian crude to record discount levels. IOC said in late February it would buy Russian oil on delivered basis to avoid any complication relating to fixing vessels and insurance.
Ethylene and propylene are the main feedstocks for the production of polyethylene (PE) and polypropylene (PP), respectively.
According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 2,487,450 tonnes in 2021, up by 13% year on year. Shipments of all grades of ethylene polymers increased. At the same time, PP shipments to the Russian market totalled 1,494.280 tonnes, up by 21% year on year. Deliveries of homopolymer PP and PP block copolymers increased, whereas shipments of PP random copolymers decreased significantly.