Indian Oil Corporation (IOC) is seeking 60,000 tonnes of diesel and could likely buy more over the next few months as demand is set to go up in summer, industry sources said today (March 22, 2012).
The state-owned refiner is seeking 320 parts-per-million sulphur diesel to be delivered into Chennai, Haldia or Paradip over April 24-26.
The tender closes on March 30.
Diesel demand in India has been growing steadily as the number of diesel-powered cars increases due to a widening gap between the price of petrol and heavily subsidised diesel.
There has also been a spike in consumption for back-up power generators following a shortfall in coal supplies late last year that caused several blackouts in the country.
Current diesel growth in India is about 5% year-on-year, and is expected to reach 7-7.5% over the summer as the harvesting season kicks in and power generation needs increase, sources said.
IOC will assess the situation and decide if it plans to seek more cargoes for May and June, the source added.
The country's biggest oil refiner plans to shut a diesel hydro treater at its 300,000 barrels per day (bpd) Panipat refinery for 15 days for maintenance in June-July, so it could likely purchase more spot diesel volumes to cover shortfalls, industry sources said.
India's other state-owned refiners Bharat Petroleum Corp and Hindustan Petroleum Corp do not have immediate plans to import diesel, however, sources familiar with the matter said.
BPCL is able to cover domestic shortfalls from diesel output from the new 120,000 bpd Bina facility which started early last year, while HPCL is expected to get supplies from joint venture 180,000 bpd Bathinda plant in the northern Punjab state which began operations in August, 2011.
IOC last bought a similar quantity of diesel from PetroChina at a premium of above $6.50 a barrel above its own pricing formula, which takes the average of Argus and Platts Middle East quotes.
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The state-owned refiner is seeking 320 parts-per-million sulphur diesel to be delivered into Chennai, Haldia or Paradip over April 24-26.
The tender closes on March 30.
Diesel demand in India has been growing steadily as the number of diesel-powered cars increases due to a widening gap between the price of petrol and heavily subsidised diesel.
There has also been a spike in consumption for back-up power generators following a shortfall in coal supplies late last year that caused several blackouts in the country.
Current diesel growth in India is about 5% year-on-year, and is expected to reach 7-7.5% over the summer as the harvesting season kicks in and power generation needs increase, sources said.
IOC will assess the situation and decide if it plans to seek more cargoes for May and June, the source added.
The country's biggest oil refiner plans to shut a diesel hydro treater at its 300,000 barrels per day (bpd) Panipat refinery for 15 days for maintenance in June-July, so it could likely purchase more spot diesel volumes to cover shortfalls, industry sources said.
India's other state-owned refiners Bharat Petroleum Corp and Hindustan Petroleum Corp do not have immediate plans to import diesel, however, sources familiar with the matter said.
BPCL is able to cover domestic shortfalls from diesel output from the new 120,000 bpd Bina facility which started early last year, while HPCL is expected to get supplies from joint venture 180,000 bpd Bathinda plant in the northern Punjab state which began operations in August, 2011.
IOC last bought a similar quantity of diesel from PetroChina at a premium of above $6.50 a barrel above its own pricing formula, which takes the average of Argus and Platts Middle East quotes.
....more info