Indian Rush Rush to buy Iranian oil before too late



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Indian imports of Iranian oil increased by about five percent between March 2018 and March 2019 compared with the previous fiscal year to March 2018, as Indian refineries rushed to buy Iranian oil from new US sanctions and hastened to end purchases before abandonment, which expires early next month.

According to preliminary data on the arrival of oil tankers received by Reuters from industry and shipping sources, Indian imports of Iranian oil in the Indian fiscal year 2018/2019, which ended last month, rose to around 479,500 bpd, compared to about 458,000 bpd , imported by the Indian refiners into Financial Year 2017/2018.

Between April and October 2018, Indian refineries purchased more than normal Iranian oil, as none of the Iranian oil buyers were convinced that it would receive an exemption from US sanctions to resume purchases from Iran after the imposition of sanctions in early November 2018. The reason for the increase in Indian The purchase of Iranian oil before November was that Iran offered very attractive conditions for Indian customers, including almost free transport and extended payment deadline.

India – along with seven other Iranian oil buyers, including China's largest buyer – received an American cancellation in order to continue to buy Iranian oil at around 300,000 bpd. Although not all Indian refineries continued to make purchases because private companies exposed to the US financial system were cautious about secondary sanctions, if they bought oil from Iran, India used its quotas of 300,000 bpd permitted in accordance with the current exception.

According to Reuters, Indian imports of Iranian oil rose to 405,000 bpd in March 2019, up 56% from February 2019.

Refiners want to make sure they stop paying before the expiry of the suspension, while ship shortfalls have put some load on the cargo by the end of February, arriving in India in March.

India does not reserve Iranian oil due to the burden in May, as refineries are waiting for more clarity from the US on whether India will extend its sanctions, Reuters reported.

Author Tsvetana Paraskova for Oilprice.com

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