Indian refiners are diversifying their crude oil sources to West Africa and altering tender terms to mitigate shipping risks in the Middle East. Hindustan Petroleum Corporation has purchased 2 million barrels of Nigerian crude, while Indian Oil Corporation has secured 4 million barrels of West African crude from Chevron. Additionally, Mangalore Refinery and Petrochemicals has structured tenders to avoid the Strait of Hormuz and the Red Sea, shifting transit risks to sellers.
Mangalore refinery tender terms
- ▪Mangalore Refinery and Petrochemicals issued a tender for 1 million barrels of crude requiring the cargo to be loaded and transported outside the Strait of Hormuz and the Red Sea.
- ▪Mitsui & Co Energy Trading Singapore sold 1 million barrels of Oman crude to Mangalore Refinery and Petrochemicals on or around August 5, 2026.
- ▪Mangalore Refinery and Petrochemicals purchased 1 million barrels of Oman crude via a tender at a premium of approximately $3 per barrel to the dated Brent contract.
Hormuz Strait shipping disruption
- ▪Prior to the 2026 conflict, approximately 80 percent of the crude oil and petroleum products transported through the Strait of Hormuz were destined for Asia.
- ▪Ongoing hostilities between Iran and the United States in 2026 have severely restricted commercial shipping traffic through the Strait of Hormuz.
Red Sea route threats
- ▪Yemen's Houthi movement conducts regular attacks in the Red Sea, targeting Saudi Arabian shipping through the Bab al-Mandab strait.
- ▪Geopolitical threats in the Red Sea and the Strait of Hormuz have prompted Asian refiners to alter risk calculations regarding Middle Eastern crude deliveries.
Asian refiner diversification strategies
- ▪Hindustan Petroleum Corporation purchased 2 million barrels of Nigerian Okwuibome and Utapate crude grades through Glencore for delivery to the Rajasthan refinery in late September 2026.
- ▪South Korean refiners have increased purchases of delivered crude cargoes to shift maritime shipping risks back to oil producers and traders.
- ▪Indian Oil Corporation purchased 4 million barrels of West African crude, including Angolan Nemba, Saxi Batuque, and Clov, and Congolese Djeno, from Chevron.
Gulf bypass pipeline infrastructure
- ▪The United Arab Emirates constructed the Abu Dhabi Crude Oil Pipeline to Fujairah to enable crude oil exports to bypass the Strait of Hormuz.
- ▪Saudi Arabia constructed the East-West pipeline to Yanbu on the Red Sea coast as an alternative export route bypassing the Strait of Hormuz.
Crude supply reliability concerns
- ▪India's refined fuel exports reached a one-year high of 1.53 million barrels per day in July 2026, driven by strong diesel margins and Russia's diesel export ban.
- ▪India's crude oil imports from Russia reached a record high of 2.8 million barrels per day in July 2026.
- ▪Geopolitical instability in the Persian Gulf has forced national oil companies to compete on delivery resilience, shipping arrangements, and contractual safety guarantees.
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