BPCL gives Sanjay Khanna additional charge of CMD
Bharat Petroleum Corporation Ltd (BPCL) has given Sanjay Khanna the additional charge of the company’s chairman and managing director. Khanna is currently director (refineries) in the state-run company. He is a chemical engineering graduate from National Institute of Technology, Tiruchirapalli, and a postgraduate in finance management from Mumbai University. Khanna has more than three decades of experience in refinery operations and technical services. He has anchored several projects for setting up processing units in Mumbai, Kochi and Numaligarh refineries, according to a BPCL statement. Prior to becoming director (refineries), Khanna headed the Kochi and Mumbai refineries of BPCL. He also serves as a director on the boards of Bharat Petro Resources Ltd and Ratnagiri Refinery and Petrochemicals Ltd. Khanna is also the chairperson of the ‘Technical Committee for petroleum refineries’ under the petroleum ministry.
Indian Oil Corporation says not in talks for term crude import deal with Russia
Indian Oil Corporation (IOC), the nation’s largest oil firm, is not discussing a term or fixed quantity deal for import of Russian oil given the volatility in the international market, Chairman A S Sahney said on Wednesday. India’s import of Russian oil has surged since the start of the Ukraine war in February 2022. Russia was India’s top crude oil supplier for the third consecutive year in 2024-25, primarily driven by attractive discounts on Russian crude. The discounts, which have narrowed since, offset the logistical challenges and longer shipping times associated with sourcing oil from Russia. Sahney said the share of Russian oil in the basket of oil that IOC imports for refining into fuels like petrol and diesel, has come down to 22-23 per cent from 30 per cent. “It has to meet my requirements and also be commercially viable,” he told reporters here. The crude, he said, has to fit into the company’s rigorous optimisation model which looks at producing the fuel that market wants from the most economically available source. “It has to make commercial sense for me to import oil from a particular source,” he said, adding the decision is not driven by sanctions or any other geopolitical issue.
HPCL and ADNOC Trading sign LNG supply agreement to strengthen energy cooperation
Hindustan Petroleum Corporation Limited (HPCL) has entered into a Liquefied Natural Gas (LNG) supply agreement with ADNOC Trading, a subsidiary of the Abu Dhabi National Oil Company (ADNOC). The agreement is part of ongoing efforts to enhance energy cooperation between India and the United Arab Emirates (UAE). Under the agreement, ADNOC Trading will supply LNG to HPCL, which will be received at the recently commissioned Chhara LNG Terminal in Gujarat. The terminal is operated by HPCL LNG Ltd., a wholly-owned subsidiary of HPCL. It has a regasification capacity of 5 million metric tonnes per annum (MMTPA) and a total LNG storage capacity of 400,000 cubic meters across two storage tanks. The LNG will be used to meet HPCL’s internal energy requirements and will also be marketed to downstream customers. This supply arrangement supports HPCL’s strategy to diversify its LNG sourcing portfolio and enhance supply security. The agreement also reflects the growing trade and energy ties between India and the UAE, aligning with India’s broader energy transition goals that include expanding the use of cleaner fuels like natural gas.
Is Saudi Arabia Preparing for Another Oil Price War?
US benchmark WTI crude is down nearly 4% as Saudi Arabia reports emerge that not only can the Saudis sustain today’s low oil prices, but output increases are likely to be announced next week, for June output, sources speaking to both Reuters and Bloomberg have indicated. On Wednesday, Reuters cited five unnamed sources as saying that the Saudis have no intention of boosting oil markets with further supply cuts, as Riyadh’s budget can tolerate sustained low prices. On the contrary, sources are suggesting that the Saudis could start producing more to grab more market share after sacrificing production for OPEC+ voluntary cuts for so long. Additionally, Bloomberg on Wednesday cited oil traders as saying they expect the Saudis to now push the cartel for another supply boost next week for June, and that this time it will be exponentially larger. “History shows that when OPEC+ leadership decides to encourage compliance by supply pressure, it does not stop until it achieves its goal,” Bloomberg quoted Bob McNally, president and founder of Rapidan Energy Advisers LLC and a former White House energy official, as saying on Wednesday. Earlier this month, OPEC+ announced it would advance the cartel’s planned phase-out of voluntary oil output cuts by ramping up output by 411,000 barrels per day in May–equivalent to three monthly increments. That move was our first indication that the Saudis may be prepared to give up their role as swing producer, having for too long picked up the slack for OPEC+ quota violators who continue to overproduce, including Kazakhstan, the UAE and Iraq. Traders are also eyeing geopolitical motivations here, according to Bloomberg, with the Saudis attempting to appease Washington, which has called on OPEC to intervene to lower fuel costs by pumping even more. At 1:31 p.m. ET on Wednesday, Brent crude was trading at $63.14, down 1.79%, while the U.S. crude benchmark, West Texas Intermediate (WTI), was trading down a sharp 3.53%, to trade at $58.29.
Saudi Signals and Trump Tariffs Are Cracking the Oil Market
Low inventories reported today by the Energy Information Administration (EIA) did nothing to staunch the bleeding, with WTI getting gutted nearly 4% on the day, and Saudi rumors throwing another spanner in the works, while new U.S. economic data suggests more pain is in store for the sector. Three weeks ago, eight OPEC+ countries unveiled plans to phase-out their voluntary oil output cuts by ramping up output in May by 411,000 barrels per day–equivalent to three monthly increments. The announcement came at a time when U.S. President Donald Trump announced tariffs on more than 90 countries across the globe, roiling oil markets. The eight OPEC+ countries are due to meet on 5 May to discuss production levels for June, just days after Washington released a worrying economic report. The U.S. economy shrank at an annualized 0.3% clip in the first quarter, marking the first contraction in three years, due to surging imports as companies rushed to stock up before Trump’s 90-day pause on elevated tariffs comes to an end. That’s a sharp turnaround in fortunes compared to the final quarter of 2024 when the economy expanded by 2.4%. Further, reports on Wednesday indicated that Saudi Arabia is planning to push for increased production during the May 5th meeting, and it will most likely get its way, with Riyadh reportedly saying it could easily sustain lower oil prices for a longer period. And now commodity analysts at Standard Chartered have predicted the weakness in oil markets is likely to persist thanks to U.S. tariff policy despite oil inventories remaining low. According to the latest weekly report by the Energy Information Administration (EIA), U.S. oil inventories remain low, with the deficit in combined U.S. crude oil, distillate and gasoline inventories below the five-year average widening to 47.4 million barrels (mb). The deficit has now more than doubled over the past three weeks to the widest in 20 months. StanChart’s proprietary U.S. oil data bull-bear index is currently ‘highly bullish’ (i.e., in the strongest 15% of all data releases since 2013)–for three weeks in a row. StanChart notes that the last time a run of data was this strong was in early 2022, helped by strong tailwinds from pandemic recovery. Whereas complete OECD inventory data comes with more of a lag, the International Energy Agency (IEA) has noted that February was the sixth consecutive month of draws, with inventories at their lowest since September 2022. Tight prompt conditions are also evident in oil futures markets, with Brent spreads remaining firmly backwardated for all but brief periods over the past year. StanChart notes that oil-price swings lower normally start from a position of oversupply and rising inventories; however, the fact that the current weakness has coincided with low and falling inventories is a strong signal that the oil market thinks U.S. economic policy coupled with Iraqi and Kazakh supply policy are both potentially unusually disruptive events for medium-term balances. Previously, we reported that Kazakhstan’s crude output hit a record high of 2.12 million barrels per day in February, good for a large 13% increase from January volumes and well above its OPEC+ quota of 1.468 million bpd. For the May meeting, StanChart says the default option is to proceed as per the schedule with a single month’s increment (about 138 kb/d). However, StanChart says a further acceleration in output is warranted, with low inventories leaving scope to add to short-term supply. Whereas the latest Kazakh compensation schedule is more front-loaded than the previous one with the total amount of compensation 43% higher, the commodity experts note that the challenge for Kazakhstan so far has been to deliver any compensation at all. Kazakh government statements over the past week have varied from stating that cuts are impossible to saying that they are still policy. It’s highly doubtful that Kazakhstan has yet managed to rebuild sufficient trust from its partners in the OPEC+ eight, leaving the option of accelerated production increases very much on the table. Meanwhile, the European Union has kicked off the injection season on a strong footing, with gas inventories rising faster than last year for the past 11 days and even faster than the five-year average on 13 of the past 16 days. According to Gas Infrastructure Europe (GIE) data, EU gas inventories clocked in at 44.72 billion cubic metres (bcm) on 27 April, with the w/w build of 1.9 bcm being 25% more than the five-year average build. However, inventories are now 26.67 bcm lower y/y and 11.68 bcm below the five-year average. Europe’s gas storage is currently at 38.4% full, much lower than 61% at this time last year. Europe’s gas prices have continued falling, with natural gas futures falling below €32 per megawatt hour, near a nine-month low.
Oil Prices Are Set for Another Monthly Dip
Crude oil prices extended their latest decline today, looking set for a monthly drop that, according to Reuters, will be the deepest in three years. At the time of writing, Brent crude was trading at $63.46 per barrel, with West Texas Intermediate at $59.68 per barrel. Since the start of the month, the benchmarks have lost between 15% and 16%, Reuters reported. This is the deepest dive since November 2021. Trump’s tariff offensive seems to be the chief reason for the price decline, with virtually every analyst and economist predicting global economic trouble because of the tariffs. The predictions naturally affect oil prices negatively, but the effect has been reinforced by OPEC+’s decision to roll back its production cuts by a larger amount than initially planned, deepening fears of oversupply. In more recent news that pressured the benchmarks, Chinese factory activity shrank in April as a direct result of Trump’s tariff barrage, with the purchasing managers’ index reading for the month dipping from 50.5 in March to 49, Reuters reported earlier today. “The sharp drop in the PMIs likely overstates the impact of tariffs due to negative sentiment effects, but it still suggests that China’s economy is coming under pressure as external demand cools,” Capital Economics analyst Zichun Huang told Reuters. “Although the government is stepping up fiscal support, this is unlikely to fully offset the drag, and we expect the economy to expand just 3.5% this year,” she added. Since any bad economic news out of China tends to pressure oil prices immediately, this latest report will likely weigh on Brent crude and WTI as well, potentially deepening the weekly rout and extending it over time. A weekly build in U.S. crude oil inventories reported by the American Petroleum Institute on Tuesday did not help prices, either, even though it follows a bigger draw for the previous reporting week.
Russia’s ESPO Blend crude finds new market in India amid China dip
Chinese firms, India’s ESPO Blend crude oil imports from Russia reached their peak since August 2024 in April, Reuters quoted data from LSEG and traders in a report. ESPO Blend is Russia’s primary light sweet crude oil grade, a significant component of its energy exports. This particular blend is loaded onto tankers at the Kozmino port, strategically located to facilitate efficient shipment to key Asian markets. ESPO Blend Notably, ESPO Blend has become a highly sought-after crude oil, particularly among Chinese independent refiners, often referred to as “teapots,” due to its specific characteristics and the reliable supply from the East Siberia–Pacific Ocean (ESPO) pipeline system that feeds the Kozmino terminal. Due to sanctions on Russian entities and scheduled maintenance, Chinese state refiners reduced their ESPO Blend crude oil acquisitions in March and April. This increased the supply available to India, the second-largest consumer of Russian oil. The quality of ESPO crude, characterised by its low sulfur content and moderate API gravity, makes it an attractive feedstock for refineries looking to produce a range of high-value petroleum products. Its popularity in Asia underscores the evolving global energy landscape and the increasing importance of Russian oil supplies to meet the growing energy demands of the region. The consistent flow of ESPO Blend from Kozmino through dedicated infrastructure ensures a stable supply, further solidifying its position as a favored crude oil grade for many Asian buyers. Imports to India this month Indian ports have been receiving increased shipments of Russia’s ESPO Blend crude oil, reaching approximately 400,000 metric tons (around 100,000 barrels daily) this month. This is a significant increase from March, which saw only one cargo of 100,000 tons, as reported by LSEG and traders. India’s ESPO Blend crude oil imports reached their highest level in April since August of the previous year, according to Reuters data. “Recently, traders have started showing us ESPO volumes as well. Seems there is low demand in China for ESPO”, one of the sources in India’s oil industry was quoted in the report. India is the top seaborne buyer of Russian oil, but it typically purchases limited quantities of ESPO Blend. This is because the grade’s complex logistics and higher cost compared to Russia’s Urals crude usually make it a less appealing option for Indian refiners. India to import additional 200,000 metric tons of ESPO Blend LSEG reports that India is expected to import an additional 200,000 metric tons of ESPO Blend in May. Market participants suggest that India’s ESPO Blend imports could increase next month due to greater availability and continued weak Chinese demand for the crude. Lower international benchmark prices have caused the cost of Russian oil, including ESPO Blend, to fall below the $60 per barrel Western price cap. This decrease may facilitate the easier procurement of the grade.
Woodside Greenlights Louisiana LNG
Woodside Energy has announced the final investment decision for the Louisiana LNG project and plans to start production in 2029. The facility is designed to have three liquefaction trains with a total capacity of 16.5 million tons annually. This would boost Woodside’s total LNG capacity to 24 million tons annually by next decade, the company said. Woodside also has permits to expand the Louisiana LNG facility by another two trains, which would boost its capacity to a total 27.6 million tons annually. Woodside bought the former Driftwood LNG project as part of its acquisition of Tellurian for $1.2 billion last year. The deal “adds a scalable US LNG development opportunity to our existing approximately 10 Mtpa of equity LNG in Australia,” Woodside chief executive Meg O’Neill said at the time. Then, this year, reports emerged that Woodside was looking for partners in the projects, seeking to sell up to 50% of the ownership. Indeed, earlier this month the news broke that Woodside had sold 40% in Louisiana LNG to infrastructure investment firm Stonepeak. Under the terms of their deal, Stonepeak will provide $5.7 billion of the total capital expenditure for the project, accounting for 75% of total capex for the project this year and next. The entry of a partner in the project boosts Louisiana LNG’s economics and Woodside’s cash flow profile, said the Australian energy giant said. The price tag for the facility has been calculated at $17.5 billion. With Stonepeak’s entry into the project, Woodside’s share of that tag has declined to $11.8 billion. Per its operator, the Louisiana LNG facility will generate some $2 billion annually in net operating cash once it enters full-scale operation. “It will drive Woodside’s next chapter of value creation, giving the company’s global portfolio the potential to generate over $8 billion of annual net operating cash in the 2030s,” the company said.
Fuel oil transport via Ctg-Dhaka pipeline to begin trial in first week of May
BPC plans to commence full-scale operations after the trial run, the officials said. Earlier in March, BPC had planned to start transporting fuel through the new pipeline, but administrative complications delayed the process. Moni Lal Das, general manager (Commerce and Operations) of BPC, told TBS that project officials held a meeting yesterday (22 April) to review progress. “It was decided that the trial run will begin in the first week of May,” he said. According to BPC officials, once the project becomes operational, the cost of transporting fuel oil will decrease, the supply chain will become more reliable, and environmental pollution can be reduced. Around 2.7 million tonnes of diesel will be transported annually through the pipeline, saving around Tk 2.36 billion each year. According to project documents, the project was approved in October 2018 with an initial completion deadline of December 2020. However, actual work began in 2020. The deadline was first extended to December 2022, and later to December 2024. Initially, the project was estimated to cost Tk 28.61 billion, but the figure has now risen to nearly Tk 36.99 billion. The project is being implemented by the Bangladesh Army’s 24 Engineer Construction Brigade on behalf of BPC. The pipeline has two sections: one stretching from Patenga in Chattogram through Feni, Cumilla, Chandpur, and Munshiganj to the Godnail depot in Narayanganj; and the other from Godnail to Fatullah. In addition to the pipeline, the project also includes booster pumps, nine generators, and other related equipment.
Oil Prices Slip Further as Market Remains in Grip of Tariff Fear
Crude oil prices extended their decline today as traders remained fixated on demand and the impact of the tariff war between the U.S. and China on its future prospects. At the time of writing, Brent crude was trading at $65.41 per barrel, with West Texas Intermediate at $61.63 per barrel, both down from opening. Besides the tariff exchange, which has already hurt energy trade between the United States and China after the latter imposed retaliatory tariffs on U.S. crude oil and natural gas, OPEC+ is also keeping oil traders awake at night. After the cartel surprised everyone by deciding to boost production in May by about three times the original amount, now there are reports it might do the same in June. Reuters broke the news last week, citing unnamed sources as saying several OPEC members would suggest another substantial output hike for the following month. The publication also suggested that the motivation behind the more robust than originally planned output boost was overproduction by Iraq and Kazakhstan, especially the latter. To add insult to injury, Astana earlier this month said it could not curb production in line with OPEC+ quotas because it could not order international oilfield operators around, after it pledged to compensate for its overproduction. “Kazakhstan’s statement cements our view that OPEC+ may implement another accelerated three-month unwind again in the May meeting and it may continue again in July and through the summer,” Energy Aspects’ Amrita Sen said at the time. A further bearish factor for oil prices, U.S.-Iran nuclear talks seem to be making some progress, which means there is a chance that U.S. sanctions on Iranian oil will be lifted at some point in the future. That chance is pressuring prices right now. ING’s commodity analysts, meanwhile, reported Monday that traders had boosted their net long positions on Brent crude after two weeks of reductions. Most of that boost came from the liquidation of short positions, the Dutch bank’s team said.