India’s Venezuelan oil imports set to hit highest level in nearly seven years

India's imports of Venezuelan oil are expected to reach their highest level in nearly seven years this month, according to Kpler estimates. The surge in imports is driven by steep discounts offered to refiners like Reliance Industries Ltd., while Russian supplies become costlier. In October, the country's crude deliveries from Venezuela are predicted to more than double to around 465,000 barrels a day, up from 196,000 barrels in September.

If all scheduled cargoes arrive on time, this would be the highest since December 2019. All of Venezuela's shipments to India are destined for the port of Sikka, where Reliance's Jamnagar refinery complex is located. The October flow could vary, with at least two tankers scheduled to arrive on India's west coast on October 31. The Venezuelan oil has been discounted by about $16 a barrel compared to ICE Brent, while freight to India's west coast adds about $33 a barrel.

In contrast, Russian Urals crude is trading at a premium before shipping costs. Reliance's Jamnagar complex is capable of processing the dense, high-sulfur Merey crude, which is currently selling at a discount in Venezuela. However, rising tanker rates could hinder the sustainability of the increased imports.