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India Readying Crude Supply Options Following US Pressure

Even if Iran supplies get disrupted, the supplies to the Indian market will still continue. That’s assured.Even if Iran supplies get disrupted, the supplies to the Indian market will still continue. That’s assured.

Indian refiners are preparing for any scenario in case they are unable to import any Iranian crude oil, as the United States has stepped up pressure on countries to bring Iranian exports down to "zero".

One of the largest Iranian customers, Indian Oil Corporation, is ready for any scenario, and it has a wide basket of alternatives to ensure crude supplies, even if India stops importing Iran’s oil completely, IOC’s Chairman Sanjiv Singh told Bloomberg in an interview published on Monday, Oil Price reported.

"Saudi Arabia could cover most of the current Iranian oil supplies for IOC if India and its refiners were to cut off Tehran crude intake," Singh added, stressing that a narrowing spread between Brent Crude and the Dubai oil benchmark gives refiners more options to source reasonably priced crude oil.

“We have a very wide crude basket. There is nothing we cannot procure; there is nothing we cannot process,” Singh told Bloomberg. “So, even if Iran supplies get disrupted, the supplies to the Indian market will still continue. That’s assured.”

“Our alternative readymade preference will be Iraq, Saudi Arabia and the UAE due to proximity. But a reasonable price would be the driving force while striking any new crude import deals,” an official working with an Indian refiner told S&P Global Platts on Friday.

  Kazakh CPC

South Korea, which consumes about 3% of the world’s oil output, is increasingly buying Kazakhstan's CPC Blend as its refiners prepare to halt imports from Iran and comply with US sanctions on Tehran that will kick in from November.

The Asian nation’s Iranian oil imports could fall to the lowest in three years in September, sources have said.

The most visible drop in Seoul’s imports from Iran was in May, when purchases fell to 179,444 barrels per day, the lowest since January 2016, data from the state-run Korea National Oil Corp show.

As Iranian imports have fallen, CPC Blend shipments to South Korea since May have been setting record monthly highs and are set to exceed 284,000 bpd in July, Reuters flows system shows.

South Korea bought 4 million tons of CPC Blend for delivery in January to July this year, compared to 1 million tons in the same seven-month period of 2017.

 

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