India's Bharat Petroleum Corp expects Russian crude purchases to fall in November as higher freight costs and unattractive offers make Middle Eastern grades more economical, a company executive said on Monday.
Russian volumes in November would be lower because Middle Eastern grades are more commercially viable compared to Russian grades, Vetsa Ramakrishna Gupta, BPCL's head of finance, told analysts after the company's quarterly earnings.
Russian cargoes were, "significantly reduced," for November because of higher freight costs, Gupta said.
In the July-to-September quarter, Russian crude was about 37 per cent of BPCL's crude sourcing mix.
BPCL said supplies from the Middle East had increased compared with the first quarter and that it expected higher volumes from the region in October and November.
India's imports of Middle Eastern crude oil surged in September, returning to pre-war levels, while its refiners cut back purchases of Russian oil amid stiff competition with China, ship tracking data showed.
However, premiums for Russian crude have narrowed to about $1-$2 a barrel for December cargoes from $12-$13 a barrel in October, BPCL said.
BPCL also warned refinery runs may moderate in the third quarter and fourth quarter as it undertakes a planned 30-day shutdown of some units at its Mumbai refinery and a 30-to-40-day maintenance turnaround involving some units at Kochi refinery.
The company also said it plans to dilute at least a 30 per cent stake in its proposed Andhra Pradesh refinery and petrochemicals project.
(Reporting by Sethuraman NR; Editing by Christian Schmollinger)