India to drastically cut oil imports from Iran under US pressure

India to drastically cut oil imports from Iran under US pressure

NEW DELHI – The Narendra Modi-led Indian government to cut oil imports from Iran to half after the US sanctions.

The step is being taken to bag the support of the United States in a bid to secure a waiver to continue with shipments, it has emerged.

According to sources privy to the developments, officials from the U.S. had discussed the issue of a conditional waiver on sanctions in talks last month in New Delhi.

Requesting anonymity, the sources disclosed that India has expressed its inability to scrap oil imports from Iran completely as its supplies are being offered at competitive rates.

New Delhi expects a response as early as next month when talks resume.

President Donald Trump’s administration was compelled to review its plan to choke off all of Iran’s oil exports after countries including China and India expressed their inability to halt shipments. The Asian countries together comprise about half of Iran’s oil exports, forcing the US bigwigs to pull back on their aggressive plans.

Washington is now said to have sought a 50 percent cut in exports when it reimposes energy sanctions in early November and in this regard, New Delhi expects a response as early as next month when talks resume.

Though Trump, who pulled out of the Iran Nuclear Deal a couple of months ago, succeeded in persuading allies Japan and South Korea the situation is tough when it comes to European Union nations.

The blows in failing to convince allies are pushing backs the U.S. to consider waivers to countries on a case-by-case basis. Washington feels that even a major cut in exports would inflict a damage on Tehran.

India has a special bond with Donald Trump, but with Iran as well, in the backdrop of Chahbahar Port. It continued with Iranian imports even after Trump’s withdrawal of 2015 nuclear deal.

Indian Oil Corp., the biggest refiner and a top customer of Iran, has booked cargoes for September, its Chairman Sanjiv Singh said on Monday.

India is estimated to have imported 22.6 million tons of Iranian oil during the 12 months through March 31 as per the figures laid out by Bloomberg. Refiners in India were quick to increase imports from the Persian Gulf state after the previous round of sanctions were lifted in 2015.

New Delhi is not in a comfortable position to cut imports from Iran as the arrangement will cost it savings on shipping and the longest credit repayment period offered by any of its suppliers.

India, the world’s third-biggest oil consumer, meets more than 80 percent of its requirements through imports and Iran is its third-largest supplier after Iraq and Saudi Arabia.