The US on Friday agreed to let India and seven other countries to buy oil from Iran.
Apart from India, the other countries which got US waiver include Japan, China and South Korea. China is still in talks with the US and negotiating on terms. US has agreed to the demands of theses countries to buy Iranian crude following the reimposition of sanctions on the oil-producing nation on Nov 5. a senior administration official said.
The US is confident that their pressure tactics will help in choking Iran's economy thus forcing them not to raise the oil prices. Further, Iran will also not directly get the money for the oil. But instead they will able to buy food, medicine or other non-sanctioned goods from its crude customers.
The US wanted everyone to reduce oil imports from Iran to zero eventually, but was open to waivers that would allow limited imports by the countries pledging ‘significant’ cut. India and other key importing countries have been engaged for months with the US for a waiver.
"It is our expectation that the purchases of Iranian crude oil will go to zero from every country or sanctions will be imposed". Mike Pompeo was quoted by Bloomberg recently.
The US had been trying to cut off all oil imports from Iran to zero by November 4 following Trump's decision in May to pull out of the 2015 multilateral deal that eased global sanctions in exchange for curbs on Iran's suspected nuclear programmes and malign activities.
India was resisting Washington's call to reduce purchases to zero, citing the galloping energy needs of its 1.3 billion people. But at the same time, India has taken steps to reduce its oil purchase from Iran, which has already declined substantially.
In his presidential determination, Trump had said "there is a sufficient supply of petroleum and petroleum products from countries other than Iran to permit a significant reduction in the volume of petroleum and petroleum products purchased from Iran by or through foreign financial institutions."