Vietnam received its first direct diesel shipment from India's Reliance Industries refinery via traders in eight years, according to data from shiptrackers and trade sources, after the removal of import taxes for fuels facilitated the trade.
Vietnam removed import taxes for all fuels from March, a policy aimed at widening its supply pool as shipping risks in the Middle East arising from the US-Iran conflict forced buyers to seek fuel beyond their regular suppliers.
Around 70,000 tonnes of the transport and industrial fuel were loaded onto the Panamax-sized tanker Magic Victoria at Reliance's refinery in Jamnagar, according to the shipping data and one of the two trade sources, with the cargo discharged at the Van Phong terminal in Khanh Hoa province operated by Petrolimex on August 14-16.
It was not immediately clear who sold the cargo to Petrolimex. A Petrolimex spokesperson declined to comment while Reliance did not immediately respond to a request for comment.
Earlier in March, some India-origin barrels were also transported to Vietnam via ship-to-ship transfer off the Strait of Singapore and Malacca, Kpler and Vortexa shiptracking data showed.
By opening up its market to other supplies, Vietnam has enabled India to step up fuel exports and capitalise on its position as a swing supplier to markets in the east and west of Suez, analysts said.
India's supply has also helped cap cash premiums for 10-ppm gasoil at $5 to $6 a barrel in Asia, despite concerns on tightening supplies in west of Suez markets.
Vietnam mostly imported its diesel from South Korea and the rest of southeast Asia last year, LSEG and Kpler shiptracking data showed. For now, it is still more profitable for India-origin cargoes to head to west of Suez markets instead of southeast Asia, another trade source said.
(Reporting by Trixie Yap in Singapore, additional reporting by Khanh Vu in Hanoi; editing by Alexandra Hudson)
