India’s refiners delay maintenance to stabilise fuel supplies
The government has invoked emergency measures, directing refiners to maximise LPG output for safeguarding cooking fuel supplies for households
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[DELHI] Indian Oil and Bharat Petroleum have delayed routine maintenance at some of their units to ensure adequate supplies in the world’s third-largest oil consumer, according to a senior government official.
“All refineries are operating at peak capacity, with some exceeding 100 per cent utilisation,” Sujata Sharma, a joint secretary at the oil ministry, said at a briefing in New Delhi on the Middle East crisis on Monday (Apr 6). She did not specify which Indian Oil and BPCL plants had deferred maintenance.
The delay by India’s state-run refiners comes as the nation grapples with a supply crunch following the effective closure of the Strait of Hormuz, a key transit route for crude, liquefied petroleum gas (LPG) and natural gas. The government has invoked emergency measures, directing refiners to maximise LPG output for safeguarding cooking fuel supplies for households.
India depends heavily on Middle Eastern supplies, with about half of its oil and more than 90 per cent of LPG shipments sourced from the region, most of which transit through Hormuz. While US waivers on Russian crude purchases have eased supply pressures, securing alternatives for LPG remains challenging.
However, Nayara Energy, a private company backed by Russian oil giant Rosneft, will proceed with a month-long shutdown from Apr 9, after deferring the maintenance for several months, Sharma said. The outage of Nayara’s 400,000-barrels-a-day refinery on India’s west coast is expected to tighten LPG availability, although the government plans to offset the shortfall through imports.
Indian Oil, the nation’s largest refiner, operates nine plants with a combined capacity to process 1.4 million barrels of crude a day. Bharat Petroleum runs three facilities that can collectively refine 709,000 barrels per day.
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New Delhi has negotiated with Iran to facilitate the safe passage of eight LPG cargoes, enough to cover roughly four days of national demand. During the weekend, the oil ministry said that refiners had secured Iranian crude too. Sharma declined to give details on how many barrels of Iranian crude had been procured and how the payments were being settled.
These are all commercial decisions, and also depend on currency conversion rates, she said. BLOOMBERG
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