Indian refining companies are snapping up rare crude grades as the coronavirus outbreak curtails China's demand for processing, executives and traders said, with prices for some grades falling by as much as 15 per cent.
Chinese refiners have slashed output by at least 1.5 million barrels a day in February, or over 10 percent, after the virus outbreak hit domestic fuel demand, leading to swelling stocks.
"Opportunity for Indian markets is more in the context of what is happening in China and in recent times we received crudes which are appearing to be attractive as compared to their value earlier," said R. Ramachandran, head of refineries at Bharat Petroleum Corp.
Refiners in India, the world's third-biggest oil importer, rarely get the opportunity to buy suitable grades from areas like the Mediterranean and Latin America due to higher freight rates.
However, shipping rates have plunged by nearly half since the virus outbreak, and after the U.S. partially lifted sanctions on part of Chinese shipping firm COSCO.