Jamnagar, October 21: US Secretary of State Marco Rubio’s visit to Reliance Industries Limited’s (RIL) mega refining complex in Jamnagar has opened the doors for an opportunity for Indian crude oil majors to refine Venezuela’s viscous, high sulfur Orinoco crude. This step is part of Washington’s efforts to expand global fuel supplies amid the continuing stalemate with Iran in the Middle East.
During his visit, Rubio discussed ways to increase Venezuelan oil processing in India, as this crude oil remains highly challenging to process, with Reliance, ONGC and a few other refiners having the skill to do so. Indian refineries possess the infrastructure to extract lighter, higher margin refined products like jet fuel and diesel from the Orinoco crude, a resource that makes all the difference at a time when oil supplies from the Middle East continue to be disrupted.
“India is a refining superpower,” he said in an interview with CNBC TV18.
“They have the capability to refine heavy crude. They’ve done so in the past, and I think as more and more Venezuelan oil comes online, it’s something they can do.”
For Indian refiners, this visit couldn’t come at a better time.
“Venezuelan crude is a great opportunity for refiners, like Reliance Industries Ltd. They have great blending facilities and complex operations, and they can yield good margins by processing those heavier grades,” DLN Sastri, the former director of refining at the Federation of Indian Petroleum Industry, told S&P Global.
Besides, RIL’s Jamnagar facility, Indian Oil’s Paradip refinery and Mangalore Refinery and Petrochemicals are also capable of processing Venezuelan crude.
This opportunity first made its way in January, when the US launched an operation to arrest Venezuelan President Nicolas Maduro and eventually opened up the country’s oil reserves once again for the international markets. The Latin American country possess the world’s largest oil reserves, though US-led sanctions had limited its sale in the international markets.
