India preparing for ‘drastic reduction’ of Iranian oil imports

Vastavam web: India’s oil ministry has asked refiners to prepare for a ‘drastic reduction or zero’ imports of Iranian oil from November, two industry sources said, the first sign that New Delhi is responding to a push by the United States to cut trade ties with Iran. India has said it does not recognise unilateral restrictions imposed by the United States, and instead follows U.N. sanctions. But the industry sources said India, the biggest buyer of Iranian oil after China, will be forced to take action to protect its exposure to the U.S. financial system.

Indian oil minister Dharmendra Pradhan told reporters in Mumbai that the country would attend to its interests while deciding on oil imports. “We know (that) to have a healthy energy mix, we can get oil from anywhere. The rest depends on geopolitics, and those decisions will be taken based on the situations,” he said. “We will go by our interests. When we decide anything on Iran, we will inform you.”

During the previous round of sanctions, India was one of the few countries that continued to buy Iranian oil, although it had to reduce imports as shipping, insurance and banking channels were choked due to the European and U.S. sanctions. “You have India, China and Europe on one side, and U.S. on the other… At this moment we really don’t know what to do, but at the same time we have to prepare ourselves to face any eventuality,” said the source. Haley, currently in Delhi, spoke with U.S. Secretary of State Mike Pompeo early on Wednesday, before meeting Modi.

The U.S. push to curb countries’ imports of Iranian oil comes after President Donald Trump withdrew from a 2015 deal between Iran and six world powers and ordered a reimposition of sanctions on Tehran.