HPCL Faces Tanker Booking Challenges Amid Strait of Hormuz Risks

State-owned Indian oil refiner Hindustan Petroleum Corp. (HPCL) is facing operational challenges in booking tankers to transit the Strait of Hormuz to pick up oil cargoes, according to Chairman Vikas Kaushal.

Speaking in an interview in Abu Dhabi, Kaushal noted that the availability of freighters and late decisions by shipowners to pull out from voyages are hindering the company's ability to ship oil originating from inside the Persian Gulf. HPCL's success in transits through the Strait has been varied, although supplies can still be sourced from locations outside the chokepoint.

"The main challenge has been hiring of ships. Even if we have crude available for purchase from the Persian Gulf, sometimes finding vessels for the available loading dates is a challenge," Kaushal said. He added that instances occur where a ship is contracted, only for the shipowner to back out at the last minute.

These logistical hurdles persist even as oil flows from the Middle East have surged in recent months, returning close to pre-war levels. An increasing number of vessels are crossing the Strait despite ongoing risks from maritime attacks. However, this higher flow coincides with a broader scarcity of global shipping vessels, which has driven up the cost of hauling oil barrels worldwide. The issue is more acute in the Strait of Hormuz, where only a relatively narrow pool of shipowners remains willing to cross the waterway.

To navigate these transit risks, Gulf producers have increasingly resorted to shuttling their exports out themselves and transferring cargoes to customers just outside the waterway.

According to data from Kpler, HPCL purchased approximately 240,000 barrels a day of Middle East oil in 2025. Purchases dropped sharply to 57,000 barrels a day in April when conflict largely shut down the Strait, but rebounded to an average of 256,000 barrels a day last month as regional supplies became more accessible.

Historically, the Mumbai-based refiner collected most of its Middle East purchases from inside the Gulf. However, the company has recently shifted toward the spot market and is taking deliveries directly at its plants, as outlined by Kaushal last month.

"Logistics and supply chain vulnerabilities can significantly impact large-scale industrial operations, especially in critical sectors like oil and energy. When geopolitical tensions and shipping scarcity create last-minute uncertainties in maritime transport, companies must adapt quickly by diversifying procurement channels and leveraging spot markets. This situation highlights the importance of operational resilience and alternative sourcing strategies in maintaining business continuity during global supply disruptions." — Dr. Shishir Gupta, Founder & CEO, StartupLanes