Indian refineries compete to charter tankers for Strait of Hormuz transits
Indian refineries have issued tenders to charter tankers for transits of the Strait of Hormuz and are negotiating directly with shipping companies, after months of avoiding sending their chartered vessels into the Gulf. Sinokor Group and Dynacom Tankers Management won charter tenders, while Shipping Corp. of India and Lila Global submitted offers in other tenders that were later cancelled. Major refiners including Indian Oil, Reliance Industries, Bharat Petroleum and HPCL-Mittal Energy have returned to buying crude on a delivered basis, with Iraq's SOMO offering discounts of up to $37 a barrel and Indian Oil buying two million barrels of Iraqi Basrah Medium at about $32 a barrel below Dubai.
Why it matters: The move bears on energy security, because Indian refiners' return to chartering their own tankers through the Strait of Hormuz makes crude supply contingent on their ability to secure vessels and manage transit risk.