Iran’s oil sales to India hit highest despite US threat of sanctions
Iran’s oil exports to India in May surged to the highest level since October 2016 after Indian refiners said they were keen to maintain Iranian oil imports despite the threat of US sanctions.
New data cited by Reuters showed India’s oil imports from Iran in the month rose 10.2 percent from the previous month to 705,000 barrels per day, about 45 percent more than a year ago.
India is Iran’s second biggest oil customer after China, with the Indian oil ministry having indicated that its imports of Iranian crude for the fiscal year 2018-19 will rise by more than 30% from the previous year.
However, different refineries may follow separate strategies in the face of looming US sanctions which are due to be reimposed after a 180-day “wind-down” period set by President Donald Trump in May.
Reuters, citing unnamed sources, claimed that Reliance Industries was preparing to halt imports of Iranian oil from October or November.
Nayara Energy, formerly known as Essar Oil which is now owned by Russia’s Rosneft, was reported Tuesday to have decided to slash its Iran imports by almost a half.
However, other Indian crude oil importers have said they will adhere to their term supply contract obligations with the Persian Gulf producer, undeterred by Washington's efforts to restrain Tehran's oil sales.
State-run Bharat Petroleum Corporation Limited (BPCL) is set to receive its regular monthly term crude oil cargo from National Iranian Oil Company (NIOC) with which it has a term contract to buy 1 million tonnes over April 2018-March 2019.
India's flagship state-run refiner Indian Oil Corporation (IOC) also holds a term contract with Iran to receive 180,000 barrels per day (bpd) in the current fiscal year ending March 2019.
India was among a select group of countries which maintained oil purchases from Iran when the country came under intensified Western sanctions in 2011.
India’s Oil Minister Dharmendra Pradhan has said the country was watching for any possible fallout from the new US sanctions.
On Sunday, Iran’s President Hassan Rouhani met Indian Prime Minister Narendra Modi who stressed the strategic importance of developing Chabahar Port for expansion of economic and regional cooperation.
The meeting took place on the sidelines of the Shanghai Cooperation Organization summit in the eastern coastal city of Qingdao.
Iran's oil exports hit 2.7 million bpd in May, representing a record high since the lifting of sanctions on Tehran in 2016 under a nuclear agreement.
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