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FinanceIndia's MRPL bars crude suppliers from using Strait of Hormuz and Red Sea routes in spot tender
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India's Mangalore Refinery and Petrochemicals Ltd. (MRPL) has become the first Indian refiner to prohibit crude suppliers from using both the Strait of Hormuz and the Red Sea, inserting the restriction into a spot tender for up to 1 million barrels of crude for delivery between August 25 and September 6. The decision follows sustained disruption in Middle East shipping corridors, including Houthi attacks on Red Sea vessels and reduced tanker traffic through Hormuz despite a halt in US-Iran strikes. MRPL did not award its previous crude tender and plans to retain the routing restrictions if West Asian conditions do not improve. Tanker traffic through the Bab el-Mandeb Strait remains near multi-month lows, with only 11 commodity tankers transiting on Sunday. Brent crude prices fell sharply to ~$88 after Washington and Tehran halted military strikes, but shipping activity has yet to recover.
Source report
India’s Mangalore Refinery and Petrochemicals Ltd. (MRPL) has become the first Indian refinery to instruct crude suppliers to avoid both the Strait of Hormuz and the Red Sea, introducing the restriction in a spot tender for up to 1 million barrels of crude.
The tender seeks cargoes for delivery between August 25 and September 6 and specifies that crude loading or transit through either the Red Sea or the Strait of Hormuz must be avoided. According to Business Standard, no previous Indian refiner has included such a requirement in a spot crude import tender.
Background of Disruption
The decision follows a week of disruption across the Middle East’s two key oil shipping corridors:
- Red Sea: Houthi forces have targeted vessels operating in the region after declaring a blockade on Saudi exports.
- Strait of Hormuz: Tanker movements remain well below normal, despite the suspension of U.S. and Iranian strikes.
MRPL’s Future Plans
Business Standard reported that MRPL did not award its previous crude tender. The company intends to retain the routing restrictions in future spot tenders if conditions in West Asia do not improve.
Impact on Tanker Traffic
Tanker traffic through the Bab el-Mandeb Strait remains near multi-month lows. On Sunday, only 11 commodity tankers transited the chokepoint, including seven oil tankers. Two very large crude carriers (VLCCs) were sailing toward Saudi Arabia’s Yanbu export terminal to load crude. Maritime intelligence firm Windward reported that tankers loading at Yanbu have shifted to AIS-dark operations while alongside the terminal.
Oil Price Movement
Brent crude prices fell sharply on Monday to approximately $88 in early morning trading, after Washington and Tehran halted military strikes. However, tanker traffic through both the Bab el-Mandeb Strait and the Strait of Hormuz has yet to recover.
By Alex Kimani for Oilprice.com
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Indian Refinery MRPL Bars Crude Suppliers From Hormuz and Red Sea Routes in Spot Tender