BROKENHILLNEWS

India’s biggest refiner, Indian Oil Corporation, has agreed to a five-year deal to import liquefied natural gas (LNG) from global trading firm Trafigura, according to three trade sources on Wednesday. The price for the LNG will be linked to the U.S. Henry Hub benchmark.

The World Bank forecasts that India’s oil consumption will be negatively affected by escalating trade tensions. Globally, oil consumption growth is expected to slow significantly in 2025 and 2026. Despite falling global commodity prices, India’s coal consumption is projected to rise, driven by government policy and the limited role of renewable energy in meeting electricity needs.

Union Minister Hardeep Singh Puri stated India’s commitment to an inclusive global energy future through open collaboration, highlighting the India-Middle East-Europe Economic Corridor (IMEC) as a key initiative. IMEC aims to integrate energy, trade, and digital infrastructure, fostering clean energy solutions.

Ahead of trade talks, Indian refiners are increasing US oil purchases, with June imports set to hit an 11-month high due to discounted WTI prices and geopolitical strategies. This surge in American crude is displacing West African imports, as India seeks to reduce reciprocal tariffs and address its widening trade deficit.

Reliance’s profit edged up by 2% year-on-year, although its oil-to-chemicals segment faced challenges due to weak transportation fuel cracks and downstream chemical market imbalances, resulting in multi-year low margins. The oil and gas business achieved record EBITDA, driven by increased production from KGD6 and CBM blocks, despite a slight revenue decrease due to lower gas production.

As Western sanctions pressure Russia’s oil exports, three more Russian insurers, including Sberbank Insurance, seek India’s approval for marine insurance on oil shipments. This move aims to maintain deliveries to India, Russia’s top oil buyer, despite growing scrutiny and a G7 price cap. India is evaluating the applications, potentially increasing the number of approved Russian insurers to eight.

Indian energy importers, including Gail India and Indian Oil Corp, are increasingly turning to cheaper oil products like naphtha and propane due to elevated LNG prices caused by outages at export plants. This shift, resulting in lower LNG imports, frees up supply for other Asian and European buyers.

Saudi Arabia is partnering with Indian companies to establish two refineries in India, each with a 9 million tonnes per year capacity. Aramco may invest ₹18,000 crore for a 26% equity stake in both projects. This renewed effort follows previous setbacks in securing a foothold in India’s refining sector, with talks ongoing regarding crude supply terms.

India and Saudi Arabia have agreed to collaborate on stabilising global oil markets and balancing energy dynamics, emphasising the security of supply for all energy sources. They will also cooperate in green hydrogen, climate change initiatives, and the circular carbon economy.