Indian Oil Corporation (IOC) signed a first ever term-tender deal with the United States Of America (USA) to buy crude oil, less than a year after they imported oil from the United States for the first time. The state owned IOC, has signed the contract to buy 6 million barrel of US crude oil for the delivery period between November 2018 to January 2019 under the single tender.
Currently the company, as well as other oil firms like HPCL, BPCL cannot enter into term deals with the other non-state owned foreign entities because of the national policy of non-entrance in term or fixed quantity deals. Up until now, the firms have been buying crude oil from US on a spot or current tender basis which comprises of one shipload of oil.
All the state-controlled oil firms, namely; IOC, HPCL, BPCL, enter into annual term contract to buy crude oil with national oil companies mainly from Middle East.
To overcome this, IOC floated a single tender to buy three shipload of US crude oil instead of one cargo which will be delivered during the month of November, December and January through Very Large Crude Carrier (VLCC).