India’s state-owned Mangalore Refinery & Petrochemicals Ltd. is seeking crude cargoes that sidestep the Red Sea and the Strait of Hormuz.
The refiner is looking for as many as 1 million barrels for delivery until early September to New Mangalore port on the southwestern coast, according to a tender document seen by Bloomberg. Nearly 300 crude grades are eligible under the tender, including some Middle Eastern varieties, which could face loading disruptions due to the U.S.-Iran hostilities.
Refiners in India, the world’s third-largest crude importer, are racing to secure alternative supplies amid uncertainty over the timely arrival of Middle Eastern cargoes. The Red Sea had emerged as a vital alternative for crude unable to pass through Hormuz. But attacks by Tehran-backed Houthi militants on ships have now put that route at risk as well.
Tensions in the Persian Gulf remain high even though Iran and the U.S. held off on attacks for a third straight night. Tehran has said there’s no change to the status of the Hormuz.
MRPL’s latest tender also includes stricter contractual protections against supply disruptions. If a cargo is declared force majeure after being awarded, the seller cannot alter the agreed loading schedule without MRPL’s consent, according to the document. The seller will also have to bear any demurrage costs if loading is delayed, it said.
The company operates a 300,000-barrel-a-day refinery in the southern state of Karnataka.
The Middle East disruptions are already reshaping India’s crude supply chain. State-run refiners had suspended crude loadings from Iraq, and are increasingly replacing Middle Eastern barrels with supplies from Russia and the Atlantic Basin. The processors are also considering an unprecedented plan to ship Saudi crude through a more expensive and longer route using the Suez Canal, and around the Cape of Good Hope.
The South Asian nation’s shipping ministry last week advised Indian vessels and foreign-owned ships carrying seafarers from the country to exercise the “highest degree of caution” while transiting waters around Yemen.
