Chennai, Aug 4 (IANS): India is looking at pockets of opportunities for oil overseas and its decision to invest $1.6 billion in an oil project in Brazil part of that scheme, said credit rating agency S&P.

In a report, S&P, citing sectoral experts, said India is keen to explore such opportunities in other Latin American countries.

"Besides expanding strategic petroleum reserves and diversifying its crude supply sources, the government is making effort to bring oil from overseas equity assets in the event of a supply disruption," said Lim Jit Yang, advisor for Asia-Pacific oil markets at Platts Analytics.

"Supply security is becoming more important as global spare capacity has been uncomfortably low. In addition, India's ageing oil wells are struggling to keep their domestic oil production steady amid growing oil demand," he added.

India is looking at diversifying the sources of crude oil for its needs.

Prime Minister Narendra Modi's cabinet in late-July approved a proposal to invest $1.6 billion to develop an oil block in Brazil in an attempt to procure equity oil overseas.

The investment will be through Bharat PetroResources Ltd. or BPRL, which holds 40 per cent stake in the BM-SEAL-11 project, while the remainder is held by Brazil's state-run Petrobras, the operator of the block.

India, the world's third-largest crude importer and consumer, sources 65 per cent of its crude requirements from the Middle East.

India has been stepping up cheap Russian oil purchases in recent months despite sanctions from the West to oil trade with Russia after the conflict in Ukraine.

The move to deepen energy relations with Brazil comes shortly after India made its intentions clear to explore opportunities for term crude deals with Brazil.