India buys more Russian Arctic crude as demand rises

Market: Crude oil
06/01/23

India has diversified its purchases of Russian crude to include Arctic grade Varandey Blend for the first time, as it further increases its dependence on Russian oil.

India received 1.82mn bl (59,000 b/d) of light sour Varandey Blend from the Barents Sea port of Murmansk in December 2022, Vortexa data show. This is the first time India has ever imported this grade, which is produced by Russian firm Lukoil, according to Vortexa.

Imports of Varandey Blend are on course to almost double this month, with 114,000 b/d to arrive in January, a 93pc increase against December.

Around 867,000 b/d of Russian crude and condensate is scheduled to arrive at Indian ports in January, according to Vortexa. This means Varandey Blend could account for around 13pc of total Russian imports this month against zero in November.

India has been buying other Arctic crude grades from Russia, taking 12.1mn bl of Arco and 3.6mn bl of Novy Port Light between late April and the end of December 2022, or equivalent to around 64,000 b/d over the period.

December's Varandey Blend imports were delivered on two Suezmax vessels at Kochi and Vadinar ports.

Vadinar port, in west India's Gujarat state, received 923,531 bl at state-controlled IOC's single buoy mooring system, which pumps oil to IOC's Mathura refinery in north India's Uttar Pradesh state. Kochi received 896,629 bl of Varandey Blend at state-controlled Bharat Petroleum's single point mooring facility, Vortexa data show.

Four Varandey Blend cargoes are scheduled for January delivery. Vishakhapatnam port in the south India's Andhra Pradesh state, where state-run Hindustan Petroleum operates a 166,000 b/d refinery, is scheduled to receive 925,555 bl on 9 January. Another 748,892 bl of Varandey Blend is scheduled to be delivered on 10 January to Vadinar port, where Russian-owned Nayara Energy operates a 400,000 b/d refinery.

Paradip port in east India's Odisha state of is due to receive 925,518 bl on 16 January. IOC operates a 300,000 b/d refinery at Paradip. Mumbai port in west India will take delivery of 923,531 bl on 27 January.

The actual owners of the January delivery cargoes are unclear.

The sharp increase in purchases of Arctic crude by Indian refiners indicates continued appetite for discounted crude to help meet sustained domestic demand for gasoline. Russia's Arctic grades have been diverted from traditional buyers in Europe because of the price caps placed by the EU, G7 and Australia on Russian crude exports.

India's total imports of Russian crude, excluding CPC blend of Kazakh origin, rose to an all-time high of 1.19mn b/d in December. Imports remained above 1mn b/d for the seventh straight month, aided by discounts offered by Russian producers in the wake of Europe's reduced imports of Russian oil.

By Chiranjivi Chakraborty

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Cop: EU, four countries commit to 1.5°C climate plans

Baku, 21 November (Argus) — The EU, Canada, Mexico, Norway and Switzerland have committed to submit new national climate plans setting out "steep emission cuts", that are consistent with the global 1.5°C temperature increase limit sought by the Paris Agreement. The EU and four countries made the pledge at the UN Cop 29 climate summit in Baku, Azerbaijan today, and called on other nations to follow suit — particularly major economies. Countries are due to submit new climate plans — known as nationally determined contributions (NDCs) — covering 2035 goals to the UN climate body the UNFCCC by early next year. The EU, Canada, Mexico, Norway and Switzerland have not yet submitted their plans, but they will be aligned with a 1.5°C pathway, EU climate commissioner Wopke Hoekstra said today. The Paris climate agreement seeks to limit the global rise in temperature to "well below" 2°C and preferably to 1.5°C. Canada's NDC is being considered by the country's cabinet and will be submitted by the 10 February deadline, Canadian ambassador for climate change Catherine Stewart said today. Switzerland's new NDC will also be submitted by the deadline, the country's representative confirmed. Pamana's special representative for climate change Juan Carlos Monterrey Gomez also joined the press conference today. Panama, which is designated as carbon negative, submitted an updated NDC in June. It is planning to submit a nature pledge, Monterrey Gomez said. "It is time to streamline processes to get to real action", he added. The UK also backed the pledge. The UK announced an ambitious emissions reduction target last week. The UAE — which hosted Cop 28 last year — released a new NDC just ahead of Cop 29, while Brazil, host of next year's Cop 30, released its new NDC on 13 November during the summit. Thailand yesterday at Cop 29 communicated a new emissions reduction target . Indonesia last week said that it intends to submit its updated NDC ahead of the February deadline, with a plan placing a ceiling on emissions and covering all greenhouse gases as well as including the oil and gas sector. Colombia also indicated that its new climate plan will seek to address fossil fuels, but it will submit its NDC by June next year . By Georgia Gratton Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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