Refiners face mounting crude disruptions from Gulf

Indian refiners are grappling with mounting disruptions to their crude supply from the Gulf, according to industry sources. The challenges include vessel attacks and transit bottlenecks, exacerbated by a tight tanker market. The situation has forced some refiners to seek alternative sources, but locating suitable vessels remains a significant hurdle.

Unplanned cancellations of contracted cargoes from the Gulf have led to delays and cancellations, putting pressure on the refiners to adjust their operations. The conflict in West Asia has intensified the issue, with the US conducting its biggest bombardment on Iran since July in retaliation, leading to further disruptions. India's crude imports fell 8% sequentially to 4.6 million barrels per day in August, the lowest in four months, partly due to vessel delays.

While the disruptions are primarily Gulf-specific, some refiners are still sourcing from other regions like Russia, the UAE, and Saudi Arabia. However, the tanker market's tightness and heightened freight rates are making it increasingly difficult to secure consistent supply, testing refiners' planning cycles and potentially impacting their monthly crude blending strategies.