MRPL management broadens crude supplier base and seeks to increase delivered cargoes
Key Facts
Management at Indian refiner Mangalore Refinery and Petrochemicals Ltd (MRPL) said it had broadened its crude purchases and added suppliers, while seeking to secure supplies from West Africa and the Americas. Management said it was also trying to maximize the share of delivered cargoes, limiting some of the uncertainty associated with securing vessels. The moves come as the company described shipping as a persistent challenge, citing high costs and prices that remain volatile from one cargo to the next. Management said the company was "moving from one cargo to another" amid the volatility. Broadening the supplier base and favoring delivered cargoes reflect an operational response to transport and insurance risks, without indicating that the company has announced a lasting change in its crude mix.
Explaining its purchasing approach, MRPL management said each cargo was selected on commercial terms based on delivered-cost economics. This approach puts the cost of bringing crude to the destination at the heart of the purchasing decision, rather than considering the oil price alone, a factor directly tied to fluctuations in freight and insurance costs. The company did not specify in the available statements the targeted increase in delivered cargoes or when it would be implemented. It also did not cite specific savings it expects from the approach. But its confirmation that cargoes are assessed on delivered-cost economics shows how transport costs factor into choices among suppliers and crude sources.
Second-quarter data show a diversified mix of crude inputs at MRPL: domestic oil accounted for about a quarter of volumes, term contracts for about half, and the rest came from the spot market. Russian crude made up about 32% of the company's mix that quarter, compared with about 28% in the first quarter. The change highlights the higher Russian share between the two quarters, alongside the company's continued reliance on a mix of domestic supplies, contracts and spot purchases. This diverse base gives the company more than one supply channel as management seeks to add suppliers from West Africa and the Americas. Its statements do not set a new numerical target for any source or purchasing category in coming periods.
For the Indian market, Business Standard reported that the country's crude imports averaged 5.6 million barrels per day through the date of its report in October, against an estimate of about 5.5 million barrels per day for the month. The report linked the strength in imports to refineries operating above their nameplate capacity. On transport costs, it said freight rates fell to a range of $20–30 per barrel in October, from $30–40 in September. Despite the decline, freight and insurance combined still accounted for about a quarter of the cost of a fully laden very large crude carrier cargo, compared with less than 5% before the war. This means the drop in freight rates from the previous month's levels did not end the substantial relative burden of transport and insurance on the cost of delivered crude.
Against the backdrop of domestic demand, India's industrial production index growth rate was 6.7% in September 2026, according to the Indian Ministry of Statistics portal. This figure concerns the overall industrial index and does not on its own establish the manufacturing sector's growth rate separately. In trading, MRPL shares closed at 179.90 rupees on November 3, up 1.37% during the session, according to data from the National Stock Exchange of India. The move relates to the session on the day before the news date and does not represent a price response to the November 4 statements. The available statements gave no specific date for implementing the delivered-cargo target or estimate of its financial impact; they were limited to broadening suppliers and trying to maximize those cargoes amid shipping volatility.