Bharat Petroleum Corp and Essar Oil Ltd will buy additional Saudi Arabian crude next month, joining Hindustan Petroleum Corp in seeking to replace Iranian supplies that have been halted in a payment dispute, according to four people with knowledge of the matter.
Saudi Arabian Oil Co will send three million barrels more next month than normally required by the three Indian refiners, said the people, who declined to be identified today because they are not authorised to speak to the media. Hindustan Petroleum will take one million barrels, according to K. Murali, the company's Mumbai-based director of refineries.
Indian refiners have said international sanctions against Iran over its nuclear programme have made banks unwilling to transfer payments for Iranian oil, forcing them to look for alternative supplies. Iran may stop crude exports to India starting August 1, state-run Fars news agency reported July 18, citing an unidentified official in the Iranian Oil Ministry.
"We will get additional cargoes from Saudi Arabia in August," Murali said yesterday. "In the future, we can also take from other countries that we have contracts with, for example Kuwait."
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The extra deliveries to the three refiners will load in August and include light and heavy grades of Saudi oil, the people said.