New Delhi :
India’s Mangalore Refinery and Petrochemicals has made its first purchase of Argentina’s Escalante crude , two sources with knowledge of the tender award said, in another sign trade routes have been redrawn by the US shale oil boom.
The purchase was for loading in end-February or early March and trader Glencore will deliver a one million barrel parcel at prices flat to dated Brent, the sources said.
“If they are getting South American and Caribbean grades through spot tenders this means these grades are available at cheaper rates than their competitors in west Africa and the Middle East,” said an Asian oil trader.
“Voyage time for a cargo from South America to India is about a month. This could be the begining of South American grades gradually showing up in state refiners’ oil purchases,” he said.
It is the first time MRPL has purchased any Latin American grade.
MRPL, which operates a 300,000 barrels per day refinery in Southern India, aims to buy as much as 40,000 bpd of Latin American grades in the next fiscal year beginning from April 1, Vijay G Joshi, its refinery director said on Wednesday.
Rising US shale oil output is re-routing the flow of Algerian, Latin American, Canadian and West African crudes, which used to flow regularly to the United States.
India’s biggest refiner Indian Oil Corp last year bought one million barrels of Canadian White Rose through a spot tender, becoming India’s first state-run refiner to buy Canadian oil .
Indian refiners are seeking to diversify their oil sources as Western sanctions over Tehran’s nuclear programme squeeze imports from Iran, once India’s second-biggest supplier. Supplies from Libya and Sudan have also been disrupted.
Escalante is a medium sweet crude with a density of 24 API degrees, extracted from the basin with the same name in southern Argentina by Pan American Energy, controlled by British BP.
source: http://www.articles.economictimes.indiatimes.com / The Economic Times / Home> News> International> Business> World News / Home> Collections> Indian Oil Corp / by Reuters / January 16th, 2014