Middle East Conflict Disrupts Oil Shipments to India
Oil shipments to India have been disrupted due to the ongoing conflict in the Middle East. At least two refiners, Bharat Petroleum Corp (BPCL) and Indian Oil Corp (IOC), have had to arrange alternative cargoes after planned deliveries failed to arrive on schedule.
According to people familiar with the matter, BPCL had four Persian Gulf cargoes that were not delivered on time in August. These included two from the United Arab Emirates, one from Saudi Arabia, and a fourth from Kuwait. The missed shipments have forced local refiners to seek other crude supplies at short notice, contributing to a recent surge in purchase tenders and cargo solicitations.
The disruptions highlight the ongoing risks to oil shipping through the Strait of Hormuz, which links the Persian Gulf to global markets. Washington and Tehran remain in dispute over the waterway, with elevated risks to shipping. Meanwhile, refiners in India are facing additional challenges as oil flows from Russia have also come under pressure due to Ukrainian attacks.
BPCL has reportedly secured deliveries through to October, but many refiners are now arranging November shipments. The scramble for alternative supplies has driven up costs, with Urals crude now priced at a premium of about US$2 (RM8.09) per barrel compared to a few weeks ago when it was trading at a discount.