Indian Refineries Struggle with Soaring Crude Costs Amidst Disrupted Markets

Indian oil refineries are facing a perfect storm of rising crude costs and reduced discounts from traditional suppliers. With Brent crude prices above $91 per barrel, refiners like HPCL and MRPL are struggling to maintain profitability despite government-regulated retail fuel prices.

The loss of discounted Russian crude has been particularly damaging, as Indian refineries historically relied on these price advantages to offset global market volatility. However, with Russian oil now trading closer to global rates, the discounts have largely evaporated.

Supply chain disruptions in the Gulf region are also driving up costs, as suppliers command higher premiums for their crude due to logistical complexities and shipping disruptions. This shift has forced refiners to increase their reliance on spot market tenders, exposing them to immediate market prices and adding uncertainty to input costs.