Hindustan Petroleum CMD discusses volatile crude oil sourcing and rising freight costs
What happened
Vikas Kaushal, Chairman and Managing Director of Hindustan Petroleum, told analysts that crude oil sourcing is currently volatile and unpredictable. The company is increasingly procuring oil on a delivered basis rather than through free-on-board or term contracts. Kaushal also noted that freight rates have doubled between the first and second quarters, with shipping costs on a Suezmax tanker rising from approximately $4 per barrel in June to $9 per barrel.
From thehindu.com
Why it matters
The shift to delivered basis means sellers bear shipping costs and risks until the oil reaches the buyer’s facility. Kaushal stated that while landed costs are volatile, producers may be able to manage costs if good deals are struck, even with astronomical freight rates.
GAIL and Hindustan Petroleum are participating companies in India.
From thehindu.com
Who's involved
- KaushalChairman and Managing Director of Hindustan Petroleum
- Hindustan PetroleumState-owned oil-marketing company
Possible ripples
Who this could reach next, traced step by step from the reporting. Possibilities worth considering, not forecasts.- HPCL's volatile sourcing strategy may impact Nayara Energy's market positionHPCL's volatile sourcing strategy may impact Nayara Energy's market positionPossible
- Crude volatility and high freight costs raise financial risks for RBIIncreased crude volatility may heighten foreign exchange risk for the Reserve Bank of IndiaPossible
- How could Hindustan Petroleum's volatile crude sourcing strategy affect the Ministry of Petroleum and Natural Gas?HPCL's volatile crude sourcing may require ministerial oversightPossible
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The entities involved
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Kaushal
Indian businessperson (born 1975, child of Gangaram)
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Hindustan Petroleum
petroleum company
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