No disruption in oil flows to India, says HPCL head

NEW DELHI: The ongoing attacks on shipping vessels by Houthi militants in the Red Sea have not impacted the flow of crude oil to India but freight has gone up due to rerouting via the Cape of Good Hope, Hindustan Petroleum Corporation (HPCL) chairman Pushp Kumar Joshi said.
India, the world’s third-biggest oil importer, gets a bulk of its Russian supplies through the Red Sea.Russian supplies made up over 35% of India’s total crude imports in 2023, amounting to 1.7 million barrels per day.
Russian ships and cargoes are not being prime targets of the attacks at this stage, however, rerouting of ships around the southern tip of Africa instead of transiting through the Suez Canal and Red Sea has led to ships taking longer voyages, resulting in the shortage of ships and rise in freight charges.
In a post-third quarter earnings call with investors, Joshi said HPCL has tied up crude oil supplies till mid-April and it does not see any supply disruptions.
HPCL meets 44-45% of its crude oil needs on term contracts with national oil companies such as those in Saudi Arabia and Iraq. The remaining is on the spot or from the current market, he said.
“Term crude has not been impacted (due to the Red Sea crisis),” he said, adding the spot imports are on DES basis where the shipping is arranged by the supplier. “The spot supplies too are not impacted.”