India’s largest oil refiner, Indian Oil Corporation (IOC), has taken a significant step towards diversifying its crude oil supply by purchasing Colombian crude, from state oil company Ecopetrol, for the first time.
The move comes as India’s imports of Russian oil declines amid tightening sanctions from the U.S. and European Union.
The deal involves the purchase of two million barrels of Castilla crude, a heavy, high-sulphur grade produced in Colombia. Delivery is scheduled for late February 2026.
The deal includes an option that would allow the IOC to scale up purchases to as much as 12 million barrels, signaling potential for a longer-term supply relationship between the Indian refiner and Colombian producers.
This marks a notable change in sourcing strategy for Indian Oil, which has historically relied heavily on supplies from Russia and the Middle East.
Since 2022, Russia had emerged as one of India’s largest crude suppliers, offering discounted barrels after Western sanctions reshaped global oil flows. However, those supplies are now showing signs of strain.
In December, India’s imports of Russian oil are expected to fall to around 1.2 million barrels per day, the lowest level in three years.
Latin America has increasingly featured on the radar of Indian refiners looking to reduce overdependence on any single region. Colombia, Brazil, and Guyana have all expanded crude production in recent years, offering alternative supply options.
While transportation costs from Latin America are generally higher than those from the Middle East, refiners may see value in spreading geopolitical and supply risks across multiple regions.
As India is the world’s third-largest oil importer, securing diverse and reliable crude supplies remains a strategic priority.
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