NEW DELHI: Indian refiners can leverage their combined consumption to seek better terms for next year’s annual contracts with suppliers, especially Russia, as a gloomy demand outlook subdues oil prices, a senior petroleum ministry official said on Thursday.
“We have seen IEA (International Energy Agency) and all such agencies lowering demand outlook in recent times.But India has emerged as a major (demand) growth centre,” he said, alluding to the growing size of India’s consumption — pegged at about 5 million barrels/day — offers a substantial market for suppliers in a tepid market.
On joint negotiations by the refiners with Russia, the official said “talks” among them “are ongoing”. Indian refiners sign annual contracts with major suppliers for part of their requirement and meet the rest through spot purchase.
The focus on Russia stems from the fact that it has become India’s top oil supplier because of discounts offered in the wake of Western sanctions and a $60 per barrel price cap, imposed after Moscow’s 2022 invasion of Ukraine, curbed markets for the Russian barrels. State-run refiners mostly buy Russian oil through spot tenders.
A similar attempt by state-run refiners to secure better terms from the Middle-East suppliers about 15 years back had come a cropper.
But the official said a contract is more than the price, which follows benchmarks. “For example, one can seek discounts, longer payment credit period, destination flexibility (allowing diversion cargo to another port in India) and other terms,” he said.
Both OPEC, accounting for 40% of globally traded oil, and the IEA have in recent times pruned their 2024 demand growth forecast. In contrast, IEA’s oil market report on India has said the country will contribute a third of the global oil consumption growth through 2030 to overtake China.
For the first time in two years, benchmark Brent crude dropped below $70 per barrel last week as fear of oversupply grew amid poor show by the major economies, especially China, the world’s second-largest oil consumer. On Thursday, however, Brent rebounded to hover just below $75, buoyed by the US interest cut.

Applications for US unemployment benefits fell to the lowest level since May, indicating the job market remains healthy despite a slowdown in hiring.
Initial claims decreased by 12,000 to 219,000 in the week ended September 14, according to Labor Department data released Thursday. That was below all estimates in a Bloomberg survey of economists. The period also corresponds with the so-called reference week when the survey is conducted for the September employment report.
Continuing claims, a proxy for the number of people receiving benefits, also dropped in the previous week, to the lowest in three months.
The four-week moving average, a metric that helps smooth out volatility in the data, fell to 227,500, the lowest since June.
What Bloomberg economics says…
“Initial jobless claims declined more than expected in the survey week for September’s employment report, due in part to difficulty adjusting the data around a major holiday like Labor Day. Claims tend to be depressed in holiday-shortened weeks, then rebound the following week — so the current data have limited value as a guide to September’s payroll print,” said Eliza Winger.
Claims for unemployment benefits have remained subdued in recent months even as labor demand cooled. The US central bank’s decision to lower interest rates by a half percentage point this week reflected policymakers’ intention to maintain what Federal Reserve Chair Jerome Powell described as “still a solid” labor market.
“We’re trying to achieve a situation where we restore price stability without the kind of painful increase in unemployment that has come sometimes with disinflation,” Powell said during a press conference Wednesday following the rate-cut announcement.
Initial claims, before adjustment for seasonal factors, rose by 6,436 to 184,845. Texas, New York and California saw the largest increases. Applications in Massachusetts fell by the most since the end of April.

Stock market today: BSE Sensex and Nifty50, the Indian equity benchmark indices, surged in trade on Friday to hit lifetime highs following a more than expected 50 basis points rate cut by the US Federal Reserve. While BSE Sensex climbed above 83,600, Nifty50 was above 25,550. At 9:20 AM, BSE Sensex was trading at 83,636.77, up 689 points or 0.83%. Nifty50 was at 25,571.70, up 194 points or 0.77%.
Siddhartha Khemka, Head of Research, Wealth Management at Motilal Oswal, says, “A 25bps rate cut is already discounted and can lead to profit booking in the market.However, a 50bps rate cut by the Fed could bring some cheer to market sentiments. Also, Fed commentary will be important as it will give clarity on the quantum and duration of the rate cut cycle. We expect the market to remain volatile in the near term with rate-sensitive sectors in focus.”
Nagaraj Shetti of HDFC Securities noted that the short-term trend of Nifty remains positive with range-bound action, and any dips to the support levels of 25,200-25,100 could present a buying opportunity. A decisive move above 25,500 levels might propel Nifty towards higher targets.
In the global markets, U.S. stocks closed with modest losses on Wednesday after the Federal Reserve cut interest rates by 50 basis points, exceeding expectations. The S&P 500 futures rose 0.5%, while Japan’s Topix gained 2%, and Australia’s S&P/ASX 200 rose 0.2%. Euro Stoxx 50 futures also climbed 0.7%.
In the forex market, the euro, Japanese yen, and offshore yuan experienced slight declines against the US dollar. Oil prices fell in Asian trading on Thursday following the larger-than-expected Federal Reserve interest rate cut, which raised concerns about the U.S. economy.
Several stocks are in the F&O ban period today, including Balrampur Chini Mills, Hindustan Copper, GNFC, RBL Bank, PNB, Bandhan Bank, Biocon, Birlasoft, LIC Housing Finance, and Granules. Foreign portfolio investors turned net buyers with Rs 1154 crore, while domestic institutional investors bought shares worth Rs 152 crore. The net long position of FIIs increased from Rs 2.2 lakh crore on Tuesday to Rs 2.37 lakh crore on Wednesday.