NEW DELHI: India is unfazed by the impending US sanctions on Iranian oil and will continue to buy fuel from the country. Confirming this, oil minister Dharmendra Pradhan said on Monday that two Indian oil firms have placed orders with Iran for November. US sanctions on Iranian oil trade and banking channels are set to go into effect from November 4, with the former maintaining that countries which don’t cut Iranian imports to zero will face penalties.
While there has been some talk of sanction waivers from the US, whether India will get one is uncertain at this stage.“Two of our oil companies have made nominations to purchase Iranian oil in November. We do not know if we will get waiver (from US sanctions) or not,” Pradhan said at an event here. Indian Oil Corporation and Mangalore Refinery and Petrochemicals have placed orders for a cumulative 1.25 million tonnes of crude oil from Iran for November.
Pradhan asserted that India’s policies will be “guided by our national interest”, and that India would have to fulfil its own domestic requirements. “We expect global leaders to understand India’s needs,” he said.
According to IOC chairman Sanjiv Singh, while negotiations are still going on, it is likely that Iran will sell its oil for rupees once the US sanctions cut off dollar banking channels.
“Iran has been accepting rupee payments even without sanctions… we will have to see how it evolves,” he said.Nearly 10 per cent of crude oil imported in 2017-18 was from Iran. Sources say this could come down in FY19 due to sanctions.
Rupee payment
Iran may accept rupee payment and use the money to pay for equipment and food items it buys from India. UCO Bank and IDBI Bank will route the payment as the two have no exposure to the US financial system.