New Delhi: India's state owned Bharat Petroleum Corporation Limited (BPCL) has purchased one million barrels of US West Texas Intermediate (WTI) crude oil at a reported premium of approximately $18 per barrel over dated Brent.
The cargo is expected to reach Mumbai between late December 2026 and early January 2027. The purchase comes as Indian refiners adjust their crude oil sourcing strategies amid changing international supply conditions and uncertainty in the global energy market.
The reported premium is significantly higher than the amount BPCL paid for a similar purchase in July this year. At that time, the company bought another one million barrels of US WTI crude from trading house Vitol at a premium of approximately $6 per barrel over dated Brent.
The difference between the two reported premiums is about $12 per barrel. However, the figures relate to separate transactions and do not represent the final landed cost of either shipment. Freight, insurance and other commercial terms can influence the overall cost of imported crude.
The latest purchase comes as BPCL reviews its dependence on different international oil suppliers. During the July to September quarter, Russian crude accounted for approximately 37 per cent of the company's total crude procurement. Saudi Arabia contributed around 19 per cent, while Abu Dhabi accounted for 17 per cent. The United States represented approximately 9 per cent.
BPCL finance director Vetsa Ramakrishna Gupta discussed the company's procurement strategy during its second quarter earnings discussion on October 26. He indicated that the company expected Russian crude purchases to decline in November as supplies from the Middle East became more commercially attractive.
Higher freight costs and less favourable commercial terms for Russian crude were among the factors affecting BPCL's purchasing decisions. The company also expected supplies from Middle Eastern producers to increase during October and November.
The latest purchase highlights the continued role of US crude in BPCL's diversified sourcing strategy. However, it does not mean that the company is abandoning Russian or Middle Eastern suppliers.
Developments in the Middle East are also adding uncertainty to international oil supplies. The Strait of Hormuz, which connects the Persian Gulf with the Gulf of Oman, is one of the world's most important routes for oil transportation. Any disruption to shipping through the waterway could affect crude supplies from major Gulf producers and increase transportation and insurance costs.
On November 3, international oil prices moved higher in early Asian trading following reports of a US strike on Iran's Qeshm Island. The development raised concerns about further disruption to oil supplies from the Middle East.
The latest developments have increased attention on the security of oil shipments through the region. However, there is no confirmation that the reported military action directly influenced BPCL's decision to purchase the latest US crude cargo.
India relies heavily on imported crude oil to meet its domestic energy requirements. The country imported approximately 259.79 million tonnes of crude oil during the 2025 to 2026 financial year.
BPCL has an annual crude oil requirement of approximately 40 million tonnes for its refining operations. Most of its crude requirement is met through imports, making international prices, shipping costs and the availability of different suppliers important factors in its purchasing decisions.
The company uses both long term supply agreements and spot market purchases to secure crude oil for its refineries.
The latest purchase highlights BPCL's efforts to maintain access to different international suppliers as global oil markets remain uncertain. The reported $18 premium also reflects the commercial challenges facing refiners as they secure crude supplies for future delivery.