“Lighter sweeter grades, mainly from west Africa are available at attractive rates as there is no demand for them in Europe,” the second source said
Indian Oil Corp, the country's largest state refiner, has bought nearly 20 million barrels of spot crude from West Africa and the Middle East for delivery in early 2021, three trade sources said on Monday.
The purchase is the largest by the refiner since the Covid-19 pandemic broke out in the world's third largest crude oil importer in second quarter.
IOC's chairman said this month that the refinery has been operating at 100% capacity since early November as local fuel demand has recovered.
IOC purchased the cargoes over three rounds of tenders this month for deliveries in January and February, the sources said.
Low-sulphur crude from Nigeria and Angola made up the bulk of the supplies, the sources said, while IOC also bought 4 million barrels of high-sulphur Abu Dhabi crude.
The grades included Erha, Forcados, Girassol, Upper Zakum, Das and Murban, they said.
"Most refineries are operating at 100%, some are even above 100%," a source with knowledge of IOC's operations said, adding that fuel demand is picking up while weather forecasts are pointing to a harsher winter.
A second source said IOC mostly issue a tender seeking a mix of various types of grades.
"Lighter sweeter grades, mainly from west Africa are available at attractive rates as there is no demand for them in Europe," the second source said.
A Singapore-based trader said IOC was covering short positions for prior months as it ramps up operations and it would likely buy less crude next month.