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Oil supplies: India hopes to win waiver from US
AGENCIES | New Delhi, June 13, 2012 05:12
Tags : Drastically | cutting imports | Iran | India | hoping | win waiver | US financial sanctions | oil trade | Iran | supplies | Persian Gulf nation. |
Tags : Drastically | cutting imports | Iran | India | hoping | win waiver | US financial sanctions | oil trade | Iran | supplies | Persian Gulf nation. |
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After drastically cutting imports from Iran, India is hoping to win waiver from US financial sanctions on its oil trade with Iran so as to continue to getting supplies from the Persian Gulf nation.
India has cut imports from Iran to 17.44 million tons in the fiscal year ending March 31, 2012, from 18.50 million tons in financial year 2010-11. This fiscal (April to March), imports would further be trimmed by 11-20 per cent (2 to 4 million tons).
"We have displayed our commitment by cutting imports from Iran. Iran has been relegated as the third largest supplier of crude oil. In 2011-12, it made up for about 10 per cent of the total imports, down from over 12 per cent previously," a top government official said.
In 2012-13, Iran will supply only 7-8 per cent of the nation's oil needs, the official said.
The United States may as early as next week announce a new list of countries that will receive exemptions to
financial sanctions on oil trade with Iran. The US had in March granted Japan and 10 European Union countries an exception and had signaled it has had good talks with South Korea about reducing oil purchases.
Without a waiver in sanctions, New Delhi may find it difficult to ship oil from July as insurance companies will
not extend cover to ship ferrying Iranian oil. A way out could be the government allowing Iranian insurance companies to provide cover to ships carrying oil and paying Iran in Indian rupee, he said. "There are discussions happening ... we are hopeful something will come out".
Currently, Indian refiners pay Iran in euros through a bank in Turkey.
Under a law that President Barack Obama signed late last year, the US can exempt countries from new sanctions, that come into effect on June 28, if they make significant reductions to crude imports from Iran.
New Delhi publicly rejects Western sanctions against Iran but has privately pushed refiners to cut imports. Imports in 2012-13 may be cut to 13 million tons instead of 15.5 million tons publicly stated target.
Without sanctions waiver, imports from Iran could come to a halt as shippers have refused to transport oil without an insurance cover. India is the world's fourth-largest oil importer and second biggest customer of Iran.
The nation's top importers - Mangalore Refinery and Petrochemicals Ltd (MRPL) and Essar Oil will both cut Iranian oil imports this fiscal. MRPL plans to reduce Iranian oil buy to less than 100,000 barrels per day from 142,000 bpd while Essar Oil plans a 15 per cent cut to 85,000 bpd from 100,000 bpd.
Indian Oil Corp (IOC) will buy 30,000 bpd while Hindustan Petroleum Corp Ltd (HPCL) plans to reduce imports from Iran to 60,000 bpd from 70,000 bpd. Bharat Petroleum Corp Ltd (BPCL) does not plan to buy any crude from Iran.
Reliance Industries stopped buying oil from Iran a few years back. The US State Department said in March that 12 countries, including India and China, were at risk of sanctions because of purchases of Iranian oil.
Issue Dated: Feb 5, 2017
