(Corrects paragraph 6 to say OPEC and major producers cutting output to balance the market, not the United States)
SINGAPORE (Reuters) - India’s Nayara Energy Ltd, part-owned by a consortium led by Russian oil major Rosneft, is scouting for ultra-heavy oil amid tightening supply following U.S. sanctions against Iran and Venezuela, its vice-president said on Tuesday.
“Iran and Venezuela have taken 3.5 million barrels per day (bpd) out of the market,” said Ashutosh S Deshpande, referring to the impact of sanctions restricting supplies from those countries in comments during a panel session at the Asia Pacific Petroleum Conference (APPEC) in Singapore.
“The market for sour (grades) and heavies has become more tight,” said Deshpande. Nayara operates a 400,000 barrels per day (bpd) refinery at Vadinar in India’s west coast.
The executive said heavy and sour crude supplies had been expected to increase, and that was supposed to help complex refineries.
“But that hasn’t happened,” he said.
Deshpande said the United States is pumping more oil, and to balance the market, members of the Organization of the Petroleum Exporting Countries (OPEC) and other major producers have cut more heavy grades.
“We are trying to get more crude from different geographies,” he said.
Reporting by Nidhi Verma; Editing by Kenneth Maxwell