Tankers with Sokol oil of the Sakhalin-1 project began moving towards the shores of India

As Kommersant learned, some tankers with Sokol oil of the Sakhalin-1 project, which were idle at sea in January, began moving towards the shores of India. However, if this oil was originally intended for the Indian Oil Corporation, now supplies, apparently, will be made to the Vadinar and Visakhapatnam refineries owned by Sakhalin-1 shareholders – Rosneft and ONGC. According to Kommersant’s interlocutors, disagreements with Indian Oil over the terms of the oil purchase have not yet been resolved. According to experts, the demonstration of alternatives in the supply of Sakhalin oil to India should prompt Indian Oil to soften its position in the negotiations.

Two tankers with Sokol oil from the Sakhalin-1 project, whose operator is Rosneft, are moving towards Indian ports, where oil of this grade has not been supplied since December 2023.

Thus, according to Kpler, the Jaguar tanker with Sokol oil, which was idle near Singapore in January, indicated Vadinar as its destination, where it should arrive on February 1. Kommersant’s interlocutors suggest that the shipment is intended for the Nayara Energy refinery, where Rosneft owns the largest share of 49.13%. In turn, the Seagull tanker is scheduled to arrive on February 5 at the port of Visakhapatnam, where the Hindustan Petroleum refinery is located – a subsidiary of ONGC, which owns 20% in Sakhalin-1.

According to Kommersant’s interlocutors, initially the oil from Sakhalin-1 was intended for the largest local oil refiner Indian Oil Corporation, but the parties were unable to agree on the terms of delivery. The disagreements, in particular, relate to the currency of payment and coincided with the tightening of the price ceiling for Russian oil by the United States. As a result, until further orders from the shipper, tankers loaded with Sokol oil were idle and used as storage facilities. According to Kommersant, a compromise with Indian Oil has not yet been reached, but it was decided to send part of the oil to refineries in India owned by Sakhalin-1 shareholders.

In addition to Rosneft and ONGC (20% each), the Japanese Sodeco (30%) is also a shareholder of Sakhalin-1. The share of the former operator of the project, American Exxon (30%), is subject to sale by decision of the Russian government.

Last week, the Russian government commented on the situation with Sokol supplies. “According to information from the companies, everything is fine, the tankers are being shipped, payments are in progress,” Deputy Prime Minister Alexander Novak assured.

By sending one Sokol to the Vadinara refinery and the other to the plant of its subsidiary ONGC, Rosneft can thereby demonstrate to Indian Oil that it has alternatives in terms of marketing Sakhalin oil, believes Victor Katona of Kpler. About 9 million barrels of Sakhalin oil are now stored in tankers on the water, “almost on par with Iranian static tankers around Singapore and Malaysia,” he adds. Victor Katona notes that next week India will host the major forum India Energy Week, which last year was attended by almost all high-ranking managers of Russian oil and gas companies. Therefore, a quick agreement is quite possible, as a result of which “all immobile Sokol parties will begin to move towards India.”

Thanks to the constant flow of Urals, which virtually does not change from month to month (about 1.1 million barrels per day), the Russian Federation maintains its status as the largest oil supplier to India, supplying about 1.45 million barrels per day, taking into account all grades, the analyst adds . However, the lack of Sokol supplies has already allowed Iraq, which exported about 1.3 million barrels per day to India in January, to move closer to Russian supply levels.

Dmitry Kozlov