BPCL Russian Crude Oil Purchases May Fall in November

Bharat Petroleum Corporation Limited (BPCL), India’s second-largest public sector refiner, expects its purchases of Russian Crude Oil to decline significantly in November as higher freight costs and supplier premiums make Russian grades less commercially attractive than oil from West Asia.

BPCL Director (Finance) Vetsa Ramakrishna Gupta said improving availability and commercial viability of Persian Gulf crude had encouraged the company to restore supplies from the region. The refiner expects West Asian oil volumes to increase further in the coming months as supply flows improve and buyers adjust to disruptions around the Strait of Hormuz.

Russian crude purchases have already edged lower in October compared with the July-September quarter, Gupta said during an investor call following BPCL’s September-quarter earnings. He indicated that November volumes would fall more substantially, although the company did not disclose specific purchase figures.

Why BPCL Expects Russian Oil Purchases to Decline

BPCL’s decision reflects a change in the relative economics of Russian and West Asian crude. Russian oil had generally been available to Indian refiners at a discount for much of the past four years. However, global supply constraints, elevated shipping costs and geopolitical risks have changed the pricing dynamics in recent months.

Gupta said Russian crude was becoming less commercially attractive than Persian Gulf grades because BPCL was not receiving sufficiently competitive offers. As a result, the company expects to source less Russian oil in November while increasing its reliance on West Asian supplies where the economics are more favourable.

During the July-September quarter, spot purchases accounted for around 67% of BPCL’s crude procurement, while Russian grades represented approximately 37% of its total crude purchases. Gupta said both proportions were broadly in line with the previous quarter.

As Middle Eastern supply flows improved, BPCL progressively restored sourcing from the region while retaining the flexibility and diversification it had developed earlier in the year. The company’s latest outlook suggests that its crude procurement mix will continue to respond to changes in availability, shipping risks and relative prices.

Russian Crude Premiums Narrow for December Cargoes

The commercial outlook for Russian crude could improve again for deliveries scheduled in December. According to Gupta, premiums for Russian crude stood at around $12-$13 per barrel in October but had narrowed to approximately $1-$2 per barrel for December cargoes.

The reduction in premiums could make Russian oil more competitive for Indian refiners if the trend continues. However, the final purchasing decision will depend on the overall cost of obtaining and transporting the crude, rather than the premium alone.

Freight charges, shipping availability, insurance and geopolitical risks can all affect the economics of crude imports. Even if the premium narrows, Russian grades may remain less attractive if transportation costs or other supply-related expenses remain high.

BPCL has not provided a specific forecast for Russian crude purchases in December. The narrower premium suggests that the commercial comparison could change again, but it does not guarantee a return to higher Russian oil volumes.

BPCL Restores More Crude Supplies From West Asia

BPCL’s sourcing data shows that Persian Gulf suppliers have regained a larger role in its crude procurement as regional flows improve. Saudi Arabia accounted for around 19% of the company’s crude imports in the July-September quarter, while the United Arab Emirates contributed approximately 17%, Gupta said.

Supplies from Iraq and Kuwait, however, had not yet returned in large quantities. BPCL expects crude volumes from West Asia to improve further in the coming months, depending on supply availability and the prevailing commercial conditions.

The shift reflects the importance of maintaining multiple sources of crude oil during periods of geopolitical uncertainty. For a large refiner such as BPCL, the choice of supplier depends on whether the oil can be delivered reliably at a competitive overall cost.

Greater availability of Persian Gulf grades could reduce the need to rely as heavily on Russian crude, particularly when freight costs and supplier premiums make Russian cargoes more expensive. However, regional disruptions could alter this balance again.

India’s West Asian Oil Imports Recover Despite Strait of Hormuz Risks

India’s crude imports from West Asia increased in September as Gulf suppliers used ship-to-ship (STS) transfers and available pipeline infrastructure to move oil amid risks surrounding the Strait of Hormuz, according to provisional tanker data cited in the report.

The Strait of Hormuz is a critical route for global oil shipments. Disruptions in and around the waterway can affect the movement of crude from several major Gulf producers, increasing uncertainty for refiners that depend on these supplies.

Data from commodity market analytics firm Kpler showed that India’s imports from Iraq, Saudi Arabia, the UAE, Kuwait and Qatar totalled around 3 million barrels per day in February 2026, before the reported West Asia war began. Their combined volumes fell to approximately 2 million barrels per day in September, a decline of about 33% from February.

The five countries accounted for 36.7% of India’s crude imports in September, up from 26% in August. Their combined share remained below the 56.3% recorded in February, indicating that supplies from these Gulf producers had not fully recovered to their earlier position in India’s import mix.

India’s crude import patterns have therefore continued to reflect the impact of disruptions around the Strait of Hormuz. While West Asian volumes have improved from recent lows, the region’s contribution remains sensitive to the availability of shipping routes and the risks associated with moving oil through the area.

How Ship-to-Ship Transfers Help Move Gulf Crude

Ship-to-ship transfers involve moving oil from one vessel to another at sea. Instead of a tanker travelling directly into a potentially risky area to load crude and then proceeding to its destination, a shuttle tanker carries the cargo for part of the journey before transferring it to another vessel.

In the arrangement described in the report, a supplier can take responsibility for moving crude through the Strait of Hormuz, after which a tanker waiting in safer waters outside the strait receives the cargo and continues the journey to the destination port.

This approach can change how shipping risks are distributed between suppliers and buyers. Buyers who might otherwise have to charter vessels into the Persian Gulf can avoid sending their own ships through the most exposed part of the route, while suppliers take on more of the logistical responsibility.

Trade sources cited in the report attributed much of the increase in exports from inside the Strait of Hormuz to ship-to-ship activity. The arrangement has helped some shipments continue despite heightened risks, although it does not eliminate the possibility of disruption.

Pipeline infrastructure also provides an alternative for some Gulf producers. Saudi Arabia and the UAE have pipelines that bypass the Strait of Hormuz, while Iraq, Kuwait and Qatar are more dependent on the waterway for oil exports.

Ukrainian Attacks Add Pressure to Russian Oil Exports

Ukrainian attacks on Russian oil and gas infrastructure have added pressure to Moscow’s energy exports, according to the report. Attacks affecting export infrastructure in the Black Sea have raised concerns about tanker navigation and the reliability of some routes used to transport Russian crude.

Analysts cited in the report said freight economics were also encouraging some buyers to avoid Black Sea routes, which account for a notable share of India’s Russian oil imports. The combination of infrastructure risks and higher shipping costs can reduce the commercial appeal of cargoes originating from affected areas.

These pressures come at a time when Russian crude is also facing stronger competition from Chinese refiners. The report links the competition to lower Russian oil exports, as Moscow seeks to maximise domestic refinery output to meet its own fuel demand amid attacks on energy infrastructure.

Reduced availability of Iranian oil for Chinese refiners during the Strait of Hormuz crisis has also increased competition for Russian supplies, according to the report. Stronger demand from Chinese buyers can push up prices and make Russian crude less attractive to Indian refiners.

The changing balance between Russian exports, Chinese demand and shipping costs has weakened some of the commercial advantages that previously made Russian crude particularly attractive to Indian buyers.

India Diversifies Its Crude Oil Imports

India’s crude procurement strategy has shifted since March 2026 as disruptions around the Strait of Hormuz tightened West Asian supply flows and increased freight risks. Russian oil has remained an important part of the country’s import mix, while refiners have also diversified towards crude from Africa, North America and South America.

The diversification is intended to offset lower or less reliable supplies from parts of the Gulf and reduce dependence on individual routes. Before the reported disruptions, around 40% of India’s crude imports typically passed through the Strait of Hormuz, making the waterway’s security a significant concern for the country’s energy supply chain.

For Indian refiners, including BPCL, the choice between Russian, West Asian and other crude grades depends on a combination of price, quality, shipping costs, availability and operational requirements. Changes in any of these factors can quickly alter the most commercially attractive sourcing options.

BPCL’s expected reduction in Russian purchases in November reflects this approach. Rather than relying exclusively on a single supplier or region, the company is adjusting its procurement mix as alternative supplies become more available and relative costs change.

What BPCL’s November Outlook Means for Oil Markets

BPCL’s forecast points to a possible shift in Indian demand towards Persian Gulf crude in November, provided West Asian supplies remain commercially attractive and available. At the same time, Russian oil may face greater pressure from freight costs, export infrastructure risks and competition from Chinese refiners.

The narrower premium reported for Russian December cargoes could change the comparison in the following month. However, refiners will need to assess the full delivered cost of the oil, including transport expenses and the risks associated with particular shipping routes.

The broader trend highlights how geopolitical developments can reshape global oil trade even when crude remains available. Disruptions around the Strait of Hormuz, attacks on Russian energy infrastructure and competition between major buyers are influencing the price and movement of supplies.

For BPCL, maintaining flexibility across suppliers and regions remains central to its procurement strategy. Its November outlook suggests that commercial viability, rather than the historical preference for discounted Russian crude alone, will play a major role in determining the company’s future buying decisions.