Indian state-controlled oil refiners are continuing to scour the global market for spot crude supply as their regular term deliveries remain constrained by the ongoing Middle East crisis and disruptions at the region's critical oil chokepoint, the Strait of Hormuz. The moves underscore India's particular exposure to supply-route instability, as the world's third-largest oil importer relies on foreign sources for more than 80% of its crude needs.

Mangalore Refinery and Petrochemicals Limited (MRPL) and Hindustan Petroleum Corporation Limited (HPCL) are seeking to purchase a combined 6 million barrels of crude oil through spot tenders, Reuters reported on Wednesday, citing tender documents it had reviewed.

HPCL is looking to acquire up to 4 million barrels of crude for delivery in September and October. MRPL, meanwhile, is seeking spot crude supply for delivery within the October 10–20 window, according to the tender documents seen by Reuters.

In addition, MRPL has specified that potential suppliers should avoid any cargoes requiring transit through the Strait of Hormuz and the Red Sea, as stated in the Mangalore refiner's tender documents. The Strait of Hormuz is one of the world's most consequential oil transit chokepoints, through which roughly a fifth of global oil consumption flows daily, making any disruption there a systemic risk for major importing nations like India.

At the end of July, when hostilities in the Middle East reignited and the Houthis threatened to disrupt Saudi Arabia's oil exports via the Red Sea, MRPL became the first Indian refiner to instruct its crude suppliers to avoid both the Strait of Hormuz and the Red Sea routes.

In recent weeks, India's state-run refiners have intensified their purchases of crude from West Africa, as the Middle East crisis has disrupted supply chains and introduced significant uncertainty into scheduled deliveries.

Last week, MRPL secured approximately 1 million barrels of crude oil from Oman through a tender, paying a premium of roughly $3 per barrel over Dated Brent. The seller was Mitsui & Co Energy Trading Singapore.

Separately, the state-run Indian Oil Corporation, India's largest refiner by capacity, purchased a total of 4 million barrels of West African crude from Chevron. The cargo includes Nemba, Saxi Batuque, and Clov grades from Angola, as well as Djeno crude from Congo.

Indian refiners are now sourcing crude from as far afield as Angola in Africa and Venezuela in South America, after their term supplies from the Middle East were again disrupted in July and unable to reach India as planned.

By Charles Kennedy for Oilprice.com