Abu Dhabi National Oil Co (Adnoc) has informed India’s Bharat Petroleum Corp (BPCL) that supplies for January could be cut, an industry source said yesterday, following Opec’s pact to make its largest-ever output reduction to stem oil’s fall.
‘The Organisation of Petroleum Exporting Countries agreed last week on a record 2.2 million barrels per day (bpd) output cut from January 1, taking the total output removed since September to 5 per cent of world output. “Adnoc has not given anything in writing, they have verbally informed BPCL to be ready for a cut in January,” the source, who could not be named, said. Replacement – The source did not say what the cut would be but “normally they cut between 5 and 15 per cent as was seen last time.” He added that BPCL was trying to import some volumes of Yemen’s Masila crude to replace any supply shortfalls due to cuts by Adnoc or any other Opec producers. BPCL buys about 40,000 barrels per day (bpd) of crude from Adnoc, the national oil company of Opec-member United Arab Emirates (UAE). In the last financial year ending March 2008, India bought 217,240 bpd of crude from the UAE. In the April-June quarter, it bought 301,420 bpd crude from the UAE. Other Opec producers such as Saudi Arabia and Kuwait have yet to inform BPCL on possible supply cuts, the source said. BPCL buys 80,000-90,000 bpd crude from Saudi Arabia. It runs a 240,000-bpd refinery in Mumbai, India’s financial hub, and another 150,000-bpd plant in Kochi in southern Kerala state. Other Asian buyers of Opec crude have yet to receive notices overnight of any further supply cuts. Top producer Saudi Arabia, which sells more than half its crude to Asia, preempted Opec’s decision by informing some customers two weeks ago of modestly sharper curbs than for December, but many refiners expected more to come, especially from other Gulf producers.