HPCL now buys almost all its Middle East crude on a delivered basis, chair Vikas Kaushal told analysts on Friday. In other words, sellers carry the oil to India. Previously, delivered cargoes made up about half of HPCL’s imports, Reuters reported.
Why HPCL is buying delivered crude
Freight costs have soared as the Iran war enters its eighth month. Shipping crude on a Suezmax tanker now costs about $9 a barrel, up from $3 to $4 in the June quarter, said finance director Srividya Venkataraman. However, producers with stranded cargoes are offering discounts to cover that cost. Kaushal added that delivered deals also keep HPCL’s own ships away from attacks.
Earlier this week, Indian Oil said it would cut Middle East term deals. Read our report.
LPG losses keep rising
Meanwhile, HPCL loses INR245 ($2.58) on each LPG cylinder in October. That loss should widen to INR327 ($3.44) in November, The Hindu reported. The company holds about 20 days of petrol and diesel stocks.
For the September quarter, consolidated net profit fell 6% to INR36.25bn ($382mn). Even so, its gross refining margin jumped to $32.15 a barrel, from $8.80 a year earlier.
Finally, its new 0.18 mmbbl/d Rajasthan refinery runs at 60% of capacity. It should start making high-sulphur fuel oil in December.
Sources
- Reuters (via The Hindu BusinessLine): HPCL is increasingly buying Middle Eastern crude on a delivered basis due to freight discounts
- The Hindu: Crude oil sourcing presently volatile; procuring more on landed basis: HPCL Chief
- HPCL: HPCL financial results for the quarter ended September 30, 2026
- The Hindu BusinessLine: Rupee falls 12 paise to close at 94.93 against US dollar
