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LAGOS  – Top Indian refiner Indian Oil Corp has skipped the purchase of U.S. oil in its latest tender and instead bought 2 million barrels of West African and a million barrels of Middle Eastern grade, trade sources said at the weekend. 

The state refiner also bought one million barrels each of Nigerian oil grades Agbami and Usan from French oil major TotalEnergy, and another million barrels of Abu Dhabi’s Das crude from Shell, the people said. 

Nigerian oil has been bought on free-on-board basis and Das has been purchsed on a delivered basis for arrival at Indian ports in late October-early November. 

In its previous tender last week, IOC bought 5 million barrels of U.S. West Texas Intermediate. In recent months, Indian refiners have advantage of a favourable arbitrage window and raised their purchase of U.S. oil via tender. 

Their U.S. oil purchases were also helping cut India’s massive trade surplus with the U.S., which has double the tariff on Indian imports to 50%, citing New Delhi’s purchase of Russian oil. 

The landed cost for U.S. crude was high compared to other grades, despite the front-month Brent-WTI differential being about $4 per barrel.

However oil fell on Friday as a weak jobs report dimmed the outlook for energy demand in the U.S., while swelling supplies may grow further after OPEC and allied producers meet over the weekend. Brent crude futures fell $1.88, or 2.81%, to $65.11 a barrel. U.S. West Texas Intermediate crude dropped $1.94, or 3.06%, to $61.54. 

On Wednesday, Reuters reported that the eight members of OPEC will consider raising production further at a meeting on Sunday. U.S. crude inventories rose 2.4 million barrels last week, rather than falling as analysts expected. “It’s kind of a perfect storm,” said Phil Flynn, senior analyst with Price Futures Group. 

“It started falling with the OPEC story. The jobs report was not helpful. That suggests the market is weakening.”