The first cargo from new oil producer Guyana to the world's third-largest crude importer, India, departed this month from a production facility off the South American nation's coast in a vessel chartered by trading firm Trafigura, data from Refinitiv Eikon showed on Tuesday.
The cargo was bought by HPCL-Mittal Energy Ltd, a joint venture between state-run Hindustan Petroleum Corp and steel tycoon L.N. Mittal, a source with knowledge of the matter said. HMEL operates a 226,000 barrel per day (bpd) Bathinda refinery in the northern state of Punjab.
India has asked refiners to speed up the diversification of imports to cut their dependence on Middle Eastern crudes after OPEC+ decided this month to extend production cuts through April, two sources said.
As OPEC's share in India's oil imports fell to historic lows between April 2020 and January 2021, the refining powerhouse began making preparations to import Guyanese crude while renewing a key supply contract between top refiner Indian Oil Corp Ltd and Russia.
The 1 million-barrel cargo of Guyana's Liza light sweet crude set sail on March 2 on Marshall Islands-flagged tanker Sea Garnet bound for India's Mundra port, where it is set to arrive around April 8. The cargo's charterer is Trafigura , according to the Eikon data.
Guyana's natural resources minister, Vickram Bharrat, told Reuters this month that the crude onboard the Sea Garnet had been originally allocated to New York-based Hess Corp, one of the companies producing crude in Guyana along with Exxon Mobil Corp, and delivered to Trafigura. Bharrat said he did not know the identity of the cargo's ultimate buyer.
Trafigura, Hess and HMEL declined to comment on commercial matters.
Since Guyana began exporting crude in early 2020, its oil has flowed mainly to the United States, China, Panama and the Caribbean, according to tanker-tracking data.
India was a prominent importer of Venezuelan oil, but tight U.S. sanctions on the South American country have since 2019 limited the volume India can buy, if it is even allowed.
India did not receive any Venezuelan crude imports in February for a third consecutive month due to Washington's suspension of oil-for-fuel swaps between state-run PDVSA and Reliance Industries Ltd since October. That compares with 371,300 barrels per day (bpd) of Venezuelan oil that arrived in Indian ports in February 2020.
Besides Russia, North American producers Canada, the United States and Mexico have gained market share by selling heavy crude grades to India.
Source:moneycontrol.com