India buys oil from Colombia for first time, gradually abandoning russian oil

India's Indian Oil Corp has purchased oil from Colombia for the first time under an option contract with state oil company Ecopetrol, thus trying to reduce its dependence on russian oil.

It was reported by Ekonomichna Pravda with reference to Reuters.

The report says that Indian refineries are now actively looking for alternative raw materials, as tougher US and EU sanctions against russian producers and tankers complicate the import of russian oil.

Russian oil imports to India in December, according to tanker tracking company Kpler, will fall to a three-year low of about 1.2 million barrels per day, down from 1.84 million bpd in November.

According to sources, IOC has purchased 2 million barrels of Colombian Castilla crude for delivery at the end of February.

The company has an option contract to purchase up to 12 million barrels, which is equivalent to six VLCC tankers (each VLCC carries about 2 million barrels), the sources added.

It is noted that the agreement was signed at the end of 2021 and has been renewed annually since then.

The IOC covers most of its oil needs from russia and the Middle East and rarely buys crude from South America, despite option contracts with Mexico, Brazil and Colombia.

The terms of the deal, including the price, have to be acceptable to both sides, and South American crude has rarely been seen as competitive with russian and Middle Eastern grades, the sources said.

As the Ukrainian News agency earlier reported, last week, Indian holding Reliance Industries Limited resumed buying oil from the aggressor country russia after a short pause, caused by the latest US sanctions against russian oil companies Rosneft and Lukoil.