Indian Oil Corporation (IOC) has received the government's nod to buy one very large ship full of crude oil from the US every month this year, as it looks at cheaper alternatives that have emerged due to global supply glut.
As per the policy, Indian shipping lines get the first right of refusal by virtue of them being allowed to match any lowest bidder for transportation of crude oil. Only when they waive their right can the oil firms use a foreign line.
Transporting US crude needs very large crude carriers (VLCCs) and can be done only by foreign shipping lines and to do that, oil companies have to obtain permission of the shipping ministry.
IOC had last month sealed a deal to import 1.6 million barrels of crude from the US for delivery in the first week of October at its Paradip refinery in Odisha -- the first ever such purchase of US crude by an Indian state-run refiner.
IOC is the largest enterprise in the country and the foremost ranked Fortune Global 500 Company in India and has presence in the complete hydrocarbon value chain from downstream refining & marketing, pipeline transportation, Petrochemicals, E&P and Gas Marketing.