TEHRAN – Iran overtook Saudi Arabia to be the second largest supplier ofcrude oil to Indian public sector firms during the first three months ofcurrent fiscal, Oil Minister Dharmendra Pradhan said today.

Indian PSUs, which last fiscal cut oil imports from Iran by a quarter,bought 5.67 million tonnes of crude oil from the Persian Gulf nation duringApril-June, higher than imports from Saudi Arabia. Imports from Iran wereonly second to Iraq.

Oil marketing companies (OMCs) had bought 9.8 million tonnes of crude oilin the full 2017-18 fiscal as compared to 13.04 in the previous 12 months,he said in a written reply to a question in the Lok Sabha here.

During first three months of 2018-19 fiscal year that began from April, thestate-owned firms bought 5.67 million tonnes of crude oil from Iran for Rs19,978.46 crore (USD 2.95 billion), he said.

State firms that buy oil from Iran include Mangalore Refinery andPetrochemicals Ltd (MRPL), Indian Oil Corp (IOC) and Hindustan PetroleumCorp Ltd (HPCL).

Extrapolating the 2018-19 purchases come to 25 million tonnes but there arenow US sanctions against Iran which block financial channels and paymentroutes.

“On May 8, 2018, the USA announced that it is walking out of the JointComprehensive Plan of Action with Iran and released a Frequently AskedQuestions regarding the re-imposition of sanctions on entities engaged withIran, including import of crude oil from Iran,” he said.

Pradhan, however, did not answer the question if the government has askedoil companies to reduce imports from Iran.

“Indian refineries import crude oil from diverse sources including Iran,depending on technical and commercial considerations,” he said.

To the question on oil from alternative countries being available on thesame commercial terms as that from Iran, he said: “Oil PSUs import crudeoil mainly keeping in view the domestic requirement. The price of crude oilis determined by many factors, including quality and demand and supply inthe global market.” The US, which in May pulled out of a landmark nucleardeal and said sanctions will be re-imposed on Iran within 180 days, hasthreatened to cut off access to the American banking system for foreignfinancial institutions that trade with Tehran.

Iran was India’s second biggest supplier of crude oil after Saudi Arabiatill 2010-11 but western sanctions over its suspected nuclear programmepushed it to the 7th spot in the subsequent years. Sourcing from Iranincreased following the lifting of sanctions and it was the third largestsupplier in 2017-18.

Pradhan said Iraq supplied 7.27 million tonnes of crude oil to OMCs duringApril-June while Saudi Arabia sold 5.22 million tonnes.