New Delhi: According to the statement of Reliance Industries Ltd joint chief financial officer, the world’s biggest refining complex has stopped importing Iranian crude in the backdrop of coming US sanctions against Tehran’s oil sector.
From November 4, the United States has planned to impose new sanctions on the oil sector business of Iran with the aim to control Iran from getting involved into Syrian and Iraqi conflicts resulting in Tehran to bent on its knees to negotiate a deal over its ballistic missile programme.
To make up for the loss being experienced due to the halting of Iranian oil and also reduced intake of Venezuelan oil, Reliance has increased its purchases from other Middle Easter suppliers and the United States as an alternative.
Due to underinvestment’s in Venezuela, there is very low production of oil in the country recording its lowest since 60 years.
“We continue to get (Venezuelan oil) but I would say it is lower,” Mr Srikanth said. “Iranian supplies are zero. Therefore we have had to look at alternatives like… Middle Eastern crudes, and we are also taking some U.S. grades.”
Reliance already has its subsidiaries operating in the US and has got significant exposure to the financial system of the country. Reliance is controlled by billionaire Mukesh Ambani.
The decision taken by the company to halt importing Iranian oil from October-November came after its insurers issued an advisory for it, a source familiar over the matter informed News Agencies in May.
In September, Reliance bought 2 million barrels of oil from Iran, according to ship tracking data from various sources.
There are two advanced plants of Reliance, both of which are located in Jamnagar in the area of western Gujrat state that can combine to process a whopping 1.4 million barrels per day (bpd) of petroleum oil. The plants also have capabilities to convert cheaper, dirtier crude oils into high-value refined products.
Reliance reported on Wednesday about its record quarterly profit for the period of July to September. “Our integrated refining and petrochemicals business generated strong cash flows,” chairman Mukesh Ambani said in a statement.
But on the other side, the gross refining margin of Reliance for the same three months through September, or total profit earned for each barrel of crude processed, fell to USD 9.50 per barrel, a 3-1/2 year low.
The recent order given to state-owned fuel retailers by the government to cut-down marketing margins by about a rupee per liter will not have any affect on the company’s plan to increase its network of retail fuel stations, Mr. Srikanth said.
The company owns a total of 1,325 fuel stations as of now. Mr. Srikanth further said that the price of gasoil and gasoline being sold through its network is competitive with the of state fuel retailers.
You May Also Read: NITI Aayog To Provide New Approach For Medical Treatment At District Hospitals