ndia will witness a sharp rise in US crude flows in the coming months and even next year as refiners consider options to sign both spot and term contracts to cushion themselves from any potential supply disruption in the event Middle East tensions escalate and disrupt oil flows, delegates attending the India Energy Forum by CERAWeek said Monday.
New Delhi is also stepping up diplomatic efforts to look into the possibility of shipping in more crude from Russia as and when economics allow. “India is too much skewed towards the Middle East and some of the recent events bring about the vulnerability in procuring from the Middle East,” B. Anand, CEO of Nayara Energy, told S&P Global Platts on the sidelines of the India Energy Forum.
“Therefore, the current initiative of the government in engaging in discussions with the US, Russia and other suppliers seems very pragmatic as they step up efforts to ensure long-term supply security,” he added. Signs of increased flows from the US are already visible in recent numbers. The US exported around 260,000 b/d of crude oil to India over the first eight months of this year, more than doubling the 138,000 b/d sent in the same period in 2018, according to the US Census Bureau.
“The US is helping India by providing a secure energy supply while meeting its environmental goals,” Kenneth Juster, the US Ambassador to India, told the India Energy Forum. “Key areas of cooperation between India and the US include defense, energy imports including crude oil, coal and liquefied natural gas, as well as renewable energy,” he added. Indian refiners have been exploring US crude grades such as Eagle Ford, Louisiana Light, Mars, West Texas and Bakken. “We have been buying a lot of new US grades,” an official at one of the state-run refineries said.