Top Indian refiner, the Indian Oil Corporation (IOC) skipped the purchase of US crude oil in its latest tender and instead bought two million barrels from Nigeria and one million barrels of Middle Eastern grade, trade sources told Reuters.
Specifically, the state refiner bought one million barrels each of Nigerian oil grades Agbami and Usan from French oil major TotalEnergy, and another million barrels of Abu Dhabi’s Das crude from Shell, the report stated.
Nigerian oil has been bought on a free-on-board basis and Das’ has been purchased on a delivered basis for arrival at Indian ports in late October-early November. In its previous tender last week, IOC bought 5 million barrels of US West Texas Intermediate (WTI).
Nigeria’s crude oil output climbed to over 1.7 million barrels per day in July 2025, for the first time in about seven months.
This represented a strong rebound from the 1.54 million bpd recorded in September 2024, a 16.6 per cent increase, and marked progress toward the country’s 2025 target of 2.06 million bpd budget benchmark.
The improvement comes on the back of tighter security in the Niger Delta, where oil theft had previously drained as much as 300,000 barrels per day.
Fresh operations and surveillance have slashed those losses to fewer than 5,000 bpd, according to the Nigerian Upstream Petroleum Regulatory Commission
(NUPRC).
At the same time, rig activity has surged, with 46 rigs recently active compared to just eight in 2021. International oil companies are also renewing interest, with International Oil Companies (IOCs) operating in Nigeria planning to expand deepwater production.
Crude exports account for about two-thirds of government revenue and more than 80 per cent of foreign exchange inflows. Rising output offers a chance to ease fiscal pressures, strengthen foreign reserves, and further stabilise the naira.
According to Reuters, in recent months, Indian refiners have taken advantage of a favourable arbitrage window and raised their purchase of US oil via tender.
Their US oil purchases were also helping cut India’s massive trade surplus with the US, which has doubled the tariff on Indian imports to 50 per cent, citing New Delhi’s purchase of Russian oil.
But the report noted that the landing cost for US crude was high compared to other grades, despite the front-month Brent-WTI differential being about $4 per barrel, reason it may now be turning to Nigeria and the Middle East.
Also, India has said it will continue to buy Russian oil as long as it remains economical to do so, despite the Donald Trump administration’s decision to impose heavy import tariffs on Indian goods due, in part, to its energy purchases from Moscow.
Since Europe and the US shunned Russian oil over Moscow’s 2022 invasion of Ukraine, India has taken advantage of discounts on Russian output to become the largest buyer of Russian seaborne crude, arguing that its purchases of Russian oil have kept the markets in balance.
Trump, who is seeking to broker an end to the Ukraine conflict, has said India’s oil imports are helping fund Moscow’s war effort and imposed a 50 per cent tariff on imports from India last month.
India’s Finance Minister, Nirmala Sitharaman, speaking on local news channel CNN-News18, said India, the world’s third-biggest oil importer and consumer, had no plans to eschew Russian supplies, despite Donald Trump’s pressure.
“We will have to take a call which (supply source) suits us the best. So we will undoubtedly be buying it,” she said, adding that India spends most of its foreign exchange on purchases of crude oil and refined fuels.
US Commerce Secretary Howard Lutnick urged India on Friday to back the dollar, resume trade talks with Washington and stop buying Russian oil. “We’re always willing to talk.
The Chinese sell to us. The Indians sell to us. They’re not going to be able to sell to each other. We are the consumer of the world,” Lutnick said in an interview.
In the fiscal year to March 2025, oil and refined fuels purchases from overseas accounted for about a quarter of India’s overall imports.
“Whether it is Russian oil or anything else, it’s our decision to buy from the place which suits our needs whether in terms of rates, logistics, anything,” Sitharaman added.
Besides, US Treasury Secretary, Scott Bessent, has accused India of profiteering by importing Russian oil at lower prices and then reselling refined fuel at a higher rate.
(This Day)
