New Delhi: Indian Oil Corporation (IOC) is preparing to form a joint venture with global energy trading firm Vitol Group in a move aimed at boosting its international trading capabilities.
According to industry sources, the partnership is expected to be launched in early 2026 and will be headquartered in Singapore.
The collaboration will mark a significant shift in Indian Oil’s strategy, moving beyond its traditional role as a state-run refiner and fuel supplier to a more global energy player. The joint venture is expected to operate for an initial period of five to seven years, with an option for either side to exit after the term.
Through this partnership, Indian Oil hopes to enhance its reach in global crude and refined product markets, negotiate better deals on crude imports, and explore new buyers for its exports.
The company had reportedly considered other global trading houses, including Trafigura, BP, and TotalEnergies, before selecting Vitol for the collaboration.
Indian Oil currently holds about 31 percent of India’s refining capacity, which totals around 5.17 million barrels per day. The company’s expansion aligns with India’s broader target to increase its refining capacity to around 6.2 million barrels per day by 2030, potentially reaching as high as 9 million barrels in the following decade.
For Vitol, one of the world’s largest independent energy traders, the partnership will offer deeper access to India’s rapidly growing energy market — the world’s third-largest oil consumer.
The alliance could also allow Vitol to strengthen its foothold in Asia, where energy demand continues to rise.
However, analysts note that the partnership may face regulatory and operational challenges, particularly around data sharing and market transparency. Some industry observers have raised concerns about granting a private trading house access to Indian Oil’s import strategy, which could influence the dynamics among existing suppliers.
Despite these concerns, the partnership underscores India’s ambition to transform into a major refining and trading hub. As global energy markets evolve, Indian Oil’s collaboration with Vitol could help the country secure a stronger position in the international oil trade, while also improving its energy procurement efficiency and export competitiveness.