India wants US sanctions waiver after cutting Iran oil imports

Irving Hamilton
October 10, 2018

File image of Dharmendra Pradhan.

Iran's crude exports fell further in the first week of October, according to tanker data and an industry source, taking a major hit from US sanctions and throwing a challenge to other OPEC oil producers as they seek to cover the shortfall.

"Likely, India and Iran will agree to use Rupee payments instead of United States dollar payments, something already tried between 2013 and 2015, with Iran then using Rupees to import food, medicines and other commodities from India", said Leszczynski.

"We will be guided by our national interest", he added.

Indian Oil Corp (IOC) Chairman Sanjiv Singh said his company is among the two which have placed order for November.

"We will continue to intervene", he said.

A vessel carrying 2 million barrels of Iranian oil was reported on Tuesday to have discharged the crude into a bonded storage tank at the port of Dalian in northeast China.

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Singh said options for paying for Iranian oil are under discussions.

Iran has warned that if it can not sell its oil due to U.S. pressure, then no other regional country will be allowed to do so either, threatening to block the Strait of Hormuz. Persistent internal issues within major oil exporting countries could keep prices high in the coming weeks.

The oil minister also teased the idea of using a different currency to buy the Iranian oil - their own currency the Indian rupee. "This time Europe is not working with the USA, so we intend to evolve a mechanism".

U.S. Secretary of State Mike Pompeo said in India last month that the White House would only consider waivers for Iran's oil buyers if they vowed to eventually bring their imports to zero. It had planned to import 9 MT of Iranian oil in 2018-19 financial year or 0.75 MT a month. China and India are the first and second biggest customers of Iranian oil, while Turkey is the biggest buyer of Iran's oil in Europe. Zanganeh said such remarks had no "real impact on the market" but were part of a psychological war against Iran, Reuters reports. "Any country that makes such claims... just wants to display its support to the usa sanctions against Iran", Zanganeh said.

Nayara Energy, formerly Essar Oil, too is stopping import from the Persian Gulf nation.

The Trump administration is open to allowing some countries to continue importing Iranian oil, despite promises to tighten the screws on Tehran and any country that continues doing business with the Islamic Republic, according to USA officials who confirmed to the Washington Free Beacon that some nations may get a temporary pass from a cadre of new sanctions set to be imposed next month.

UCO Bank and IDBI Bank have been identified to route the payment as the two have no exposure to the United States financial system.

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