India's 2018/19 Iran oil imports up 5 percent despite US sanctions

Traders There won’t be enough oil for everyone

Traders There won’t be enough oil for everyone

According to the data obtained by Reuters, India's imports of Iranian oil jumped to 405,000 bpd in March 2019, up by 56 percent from February 2019. Although not all Indian refiners continued purchases because private companies with exposure to the USA financial system were wary of secondary sanctions if they buy oil from Iran, India used up its 300,000 bpd quota allowed under the current exemption.

Last month Tehran's share in India's overall oil imports declined to about 5 percent from about 14 percent a year earlier, the data showed.

Delivery of some cargoes is delayed to March as Tehran has a limited number of ships. Indian refiners raised purchases from Iran in April-October 2018, drawn to nearly free shipping and extended credit offered by Tehran to boost sales.

Iran was the eighth biggest oil supplier to India in February compared with seventh in January, and slipped from third position it held a year ago, the data showed.

India is not booking Iranian oil due to load in May, as refiners are waiting for more clarity from the US on whether India will get its sanctions waiver extended, Reuters reported earlier this week, citing four sources.

Since November, when India received the sanctions waiver, only state-run Indian Oil Corp, Bharat Petroleum Corp, Hindustan Petroleum and Mangalore Refinery and Petrochemicals have been buying Iranian oil.

"As a result, European refiners have been left competing to secure as much medium, sour Russian Urals as they can, pushing the differential of that oil to levels not seen since 2013", the news agency reports.

Indian refiners have not yet placed orders to lift Iranian oil in May pending clarity on whether Washington will extend a the sanctions waiver.

The surge in buyers searching for Urals oil has led to Russian companies reportedly making $140 million more last month than they did in October.