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Amid strained relations between India and China, Indian state-held oil firms have stopped chartering China-owned or flagged tankers for import or export of oil and oil products.

Vessels owned or registered by China are prohibited from taking part in tenders for oil tankers that import crude oil into India or export refined petroleum products out of India, Bloomberg’s sources said.

In addition, India’s state-controlled oil majors also plan to ask its oil suppliers and oil traders not to deliver oil to them by chartering Chinese tankers, according to Bloomberg’s sources.  

The recent hostility that erupted between two of the world’s biggest oil importers – and the two largest in Asia, China and India – has strained business and trade relations between the two countries. The relationship between India and China has always been shaky, but a recent flare-up of tensions on the border between the two became the most violent in 50 years, since China and India fought a war to establish where precisely this border would pass. Both countries are nuclear powers, which has worried the UN, who has called on Beijing and New Delhi to “exercise maximum restraint.”

The India-China standoff reverberated in many trade areas, with Chinese imports suddenly held up at Indian ports for scrutiny without warning, trade organizations told CNN Business at the end of June.

Despite the fact that India’s state oil majors will not be using vessels linked to China, the Indian companies do not expect major disruptions in oil trade flows because their use of Chinese vessels was limited anyway.

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India’s companies charter Chinese tankers mostly for the transportation of liquefied natural gas (LNG), Indian oil executives told Bloomberg. Most of the non-Indian oil tankers the oil firms hire have Liberia, Panama, or Mauritius as their flag state, according to the executives.  

This article was originally published on Oilprice.com