Dip in Iran oil import
India's oil imports from Iran showed a decline of over 25 per cent in June, but some shipments loaded last month are expected to arrive this month, government and industry officials said Wednesday.
- Published 12.07.18
New Delhi: India's oil imports from Iran showed a decline of over 25 per cent in June, but some shipments loaded last month are expected to arrive this month, government and industry officials said Wednesday.
After scaling imports to around 770,000 barrels per day in May, imports from Iran were down to 570,000 bpd in June as India considers acquiescing to US President Donald Trump's demands for ending oil imports from Iran by November 4.
Officials said actual shipment reaching Indian shores has shown a decline but some of the oil that was loaded in June arrived this month.
While New Delhi says it does not recognise unilateral restrictions imposed by the US on any country and instead follows UN sanctions, oil firms have been asked to be prepared for channels to pay for Iranian oil getting blocked by November, following sanctions against the Persian Gulf nation, they said.
Russia's Rosneft-based Nayara Energy and private sector Reliance Industries as well as state-owned Indian Oil Corp (IOC) showed lesser Iranian purchases, but Mangalore Refinery and Petrochemicals Ltd (MPRL) sourced more oil.
Imports from Iran, which currently is India's third largest supplier of oil after Iraq and Saudi Arabia, are likely to come down gradually and will have to be replaced with more purchases from countries such as Saudi Arabia and Kuwait, they said, adding imports from Iran after November 4 will be possible only if Iran accepts alternatives like rupee payments.
The US is piling pressure on India, China, and other buyers to end all imports of Iranian oil by a November 4 deadline as it looks to choke the Persian Gulf state's economic lifeline with sanctions over its nuclear programme.
The US, which in May pulled out of a landmark nuclear deal and said sanctions will be re-imposed on Iran within 180 days, has threatened to cut off access to the American banking system for foreign financial institutions that trade with Iran. This means India, Asia's second-largest importer after China, will have to give up the euro payment mechanism for Iranian crude imports from November when US sanctions against Iran come into force.
But, it still could continue imports if Iran accepts an alternative payment or offers a longer credit period.