Indian Refiners Abandon Gulf State Tankers Amid Hormuz Attacks

Indian refiners have shifted their focus to using local tankers for transporting oil from the Persian Gulf, following recent attacks on vessels in the Strait of Hormuz. According to a Bloomberg report, two shipping companies have won tenders for Persian Gulf oil, while another two submitted bids that were subsequently canceled.

The decision to use Indian tankers comes as freight and insurance costs for Middle East routes have skyrocketed due to heightened security risks. Refiners such as Indian Oil, Reliance, Bharat Petroleum, and HPCL-Mittal had previously opted for free-on-board cargoes of Iraqi oil, where the buyer is responsible for arranging transportation.

Iraq's state-owned SOMO has been offering discounts of up to 37% on its crude for October loading, which may have contributed to India's decision to switch to local tankers. The country has been increasing its imports of Middle Eastern oil, with an average daily intake of 3 million barrels in September.

India's reliance on Middle Eastern oil comes as the US imposed a threat of 100% tariffs on Indian imports if refiners continued to buy Russian oil.