February 19, 2019

India to Continue Iranian Oil Imports after US Sanctions

08 October 2018, 12:56 | Joann Bryant

Reuven Rivlin with German Chancellor Angela Merkel at the President's residence in Jerusalem Israel

Reuven Rivlin with German Chancellor Angela Merkel at the President's residence in Jerusalem Israel

Crude oil for October was trading lower by Rs 80, or 1.44 percent, to Rs 5,466 per barrel with a business volume of 2,472 lots at the Multi Commodity Exchange (MCX).

The Trump administration is actively considering waivers on sanctions it will reimpose next month for countries that are reducing their imports of Iranian oil, a USA government official said on Friday.

US sanctions will target Iran's crude oil exports from November 4, and Washington has been putting pressure on governments and companies worldwide to cut their imports to zero.

"Iranian export losses have already accelerated faster than we expected", said Paul Sheldon, S&P Global Platts Analytics' chief geopolitical adviser. Yet, if a supply shock is prevented with Russia's cooperation and the price of oil then stays below $100, those potential economic catastrophes may be averted.

United States oil shipments to India fell to 84,000 barrels per day (bpd) last month, from a record high of 347,000 bpd in June, the news agency reported on Friday, citing traders and shipping intelligence firm Kpler.

India is the second biggest purchaser of Iranian crude after China which also increased shipments from the Middle Eastern country by 29,000 bpd to 620,000 bpd.

The administration withdrew from a deal over Tehran's nuclear program in May and is unilaterally reimposing sanctions on Iran's crude oil consumers on November 4.

US Secretary of State Mike Pompeo last month said that on November 4th the sanctions against Iran will be enforced and that the US will consider waivers for countries that bring their Iranian oil purchases down to zero. Saudi Arabia is now pumping about 10.7 million barrels per day (bpd) and can add a further 1.3 million "if the market needs that", he said.

Like Putin, Al-Falih blamed part of the increase on the market's anticipation of disruptions in Iran and elsewhere, rather than the current balance between supply and demand.

There were also reports from Saudi Arabia claiming that it has raised output in October and will further hike production in November.

In its submission to the court, Iran argued that the USA had violated both the terms of a 1955 bilateral friendship treaty, the Treaty of Amity, and a core provision of global law which protected the 2015 Iran nuclear agreement.

Iran's Supreme Leader Ali Khamenei said Thursday his country is facing a "sensitive time" and economic problems because of the pressure from USA sanctions.

Iran's key oil customers are opting for more medium sour crudes from Saudi Arabia, Iraq, Russia and UAE, which is causing prices of these grades to soar and putting pressure on global refinery margins.

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