Skip to content
Search

Latest Stories

India Oil Corporation ties up crude oil from US, Saudi to make up for Iran shortfall

INDIA'S Indian Oil Corporation (IOC), the nation's biggest oil firm, has tied up imports from the US and taken additional volumes from Saudi Arabia to make up for the bulk of the volumes lost because of sanctions prohibiting buying oil from Iran, top officials said today (17).

Iran supplied more than a tenth of India's oil needs before the reimposition of the US sanctions against the Persian Gulf nation stopped supplies this month.


"We have tied up supplies from alternate sources. No single country can make up for the volumes lost, that's why we are keeping our sourcing diversified. We are fairly diversified in our sourcing and we have robust sourcing in place to make up for all of the Iranian oil," IOC Chairman Sanjiv Singh told reporters in New Delhi.

India bought close to 24 million tonnes of crude oil from Iran in the fiscal ended March 31. Of this, IOC sourced about 9 million tonnes from Iran.

IOC and other Indian refiners stopped importing crude oil from Iran this month following the US' move to end sanction waivers.

To make up for the shortfall, IOC has used optional volumes available from suppliers such as Saudi Arabia. Also, it has for the first time signed term import contracts with two US suppliers, he said, adding in all 4.6 million tonnes of crude oil from the US has been signed up for 2019.

IOC director A K Sharma said the company has an annual contract to buy 5.6 million tonnes of crude oil from Saudi Arabia. On top of this, it has the option to import an additional two million tonnes.

"We have exercised our optional volumes with Saudi Arabia and will be importing two million barrels of additional crude oil from Saudi Arabia in six months period beginning July," he said, adding the optional volumes imported from July to December total to about 1.5-1.6 million tonnes.

From the US, IOC has signed a deal with Norwegian oil company Equinor for buying three million tonnes of crude during the year and an additional 1.6 million tonnes from Algerian national oil company Sonatrach.

Equinor and Sonatrach produce crude oil in the US.

Singh said refiners import crude oil from a wide range of sources and have been lining up alternate supplies for the past months.

"The US was to take a decision on waiver extension in April and Indian refineries had prepared plans for all eventualities. We have alternate sources lined up to make up for any shortfall," he said.

The US president Donald Trump last year withdrew from the 2015 nuclear deal between Iran and world powers and revived a range of sanctions against the Persian Gulf nation. It, however, granted a six-month waiver from sanctions to eight countries China, India, Japan, South Korea, Taiwan, Turkey, Italy, and Greece but with a condition that they would reduce their purchases of Iranian oil.

The waiver began in November 2018 and expired on May 2.

India had agreed to restrict its monthly purchase to 1.25 million tonnes to get the waiver. But since it had made robust purchases in the period prior to November 2018, India's overall crude oil imports from Iran totalled nearly 24 million tonnes in 2018-19 as compared to 22.6 million tonnes bought in the 2017-18.

"We have optional volumes (over and above the term contracts) from a number of suppliers which we can exercise to make up for any shortfall from Iran," Singh said. "We can also go to the spot (or current) market to source crude."

IOC has the option to take 0.7 million tonnes of crude oil from Mexico on top of its committed purchase of 0.7 million tonnes during the year. Similarly, it has optional volumes of 1.5 million tonnes from Kuwait and another 1 million tonnes from the UAE, Sharma said.

"We have all the supplies tied up and I think globally crude will be readily available but it is difficult to say what the impact will be on price," Singh added.

(PTI)

More For You

Donald Trump

Speaking from the Oval Office, Trump said, 'What we’re going to be doing is a 25 per cent tariff on all cars that are not made in the US.'

Getty Images

Trump imposes 25 per cent tariffs on foreign-built cars

US president Donald Trump has announced a 25 per cent tariff on imported cars and auto parts, escalating trade tensions with key partners.

The new duties take effect on 3 April and apply to foreign-made cars and light trucks, with additional levies on key auto parts set to follow within the month.

Keep ReadingShow less
Starmer-Trump-Getty

The UK is negotiating a tech-focused trade deal with the US, which could help avoid direct tariff impacts.

Getty Images

UK economy faces pressure from Trump’s tariff threats

THE UK’s economy faces a major risk from US president Donald Trump’s proposed tariffs, the country’s fiscal watchdog warned on Wednesday, citing slow growth and a high debt burden as key vulnerabilities.

Chancellor Rachel Reeves announced cuts to the welfare budget and other spending reductions to meet a key fiscal target aimed at reassuring investors after the 2022 market turmoil under former prime minister Liz Truss.

Keep ReadingShow less
FCA's new five-year plan focuses on economic growth
Nikhil Rathi

FCA's new five-year plan focuses on economic growth

COUNTRY's financial watchdog has launched a new five-year strategy aimed at transforming financial regulation in the UK, focusing on supporting economic growth and improving consumer experiences.

The Financial Conduct Authority (FCA) on Tuesday (25) outlined four key priorities: becoming a smarter regulator, supporting economic growth, helping consumers make financial decisions, and combating financial crime.

Keep ReadingShow less
modi-trump-getty
Modi shakes hands with Trump before a meeting at Hyderabad House in New Delhi on February 25, 2020. (Photo: Getty Images)

US trade officials in India for talks as tariff deadline nears

US OFFICIALS arrived in India on Tuesday for trade discussions ahead of the implementation of tariffs announced by president Donald Trump.

The meetings come as the US moves forward with reciprocal tariff measures affecting multiple countries, including India.

Keep ReadingShow less
modi-trump-getty
Modi shakes hands with Trump before a meeting at Hyderabad House in New Delhi on February 25, 2020. (Photo: Getty Images)

India open to tariff cuts on £17.7 bn worth of US imports: Report

INDIA is considering cutting tariffs on more than half of US imports valued at £17.7 billion as part of ongoing trade negotiations, two government sources told Reuters.

The move, which would be the most significant tariff reduction in years, is aimed at countering reciprocal tariffs.

Keep ReadingShow less