NEW DELHI: India imported nearly 29 per cent more oil from Iran in December over November but still cut purchases 19 per cent in the first nine months of year-long contracts, data from trade sources shows, a cut that has won it a waiver from western sanctions.
European Union and US sanctions aimed at forcing Iran to curb its disputed nuclear programme, which the West believes is aimed at making a bomb, have more than halved Iran’s oil exports in 2012. Iran says its nuclear programme is for civilian use.
Iran’s major Asian clients — China, India, Japan andSouth Korea — have all cut imports heavily to secure the waiver and continued access to the US financial system.
New Delhi, Tehran’s top oil client after China, has reduced Iran’s importance as a supplier to about 8.6 per cent of all imports in 2012 and turned instead to Latin American sellers who now account for about 15.5 per cent of its crude purchases.
India plans to reduce imports from Iran by another 10-15 per cent in the next contract year starting April 1, and more if Tehran does not lower prices to help cover costs resulting from Western sanctions, sources have said.
New Delhi shipped in about 276,000 barrels per day (bpd) of oil from Iran in December as Indian Oil Corp, the country’s top refiner, drew higher volumes to honour its commitment under an annual deal, the data showed.
IOC, which has a deal to import an average 30,000 bpd oil from Iran in the year to March 31, replaced MRPL as Iran’s top Indian client in December, buying two very large crude carriers from Tehran. IOC did not import Iranian oil in June-October.
Refiners adjust crude purchases from month to month to tweak their product slate as they try to maximise profit margins.
In April-December, India imported about 270,700 bpd oil from Iran, the data showed, below the government’s target of 310,000 bpd for the current fiscal year ending March 31, 2013.
In 2012, India imported about 2 per cent less oil from Iran, the data showed. But this does not properly reflect New Delhi’s attempts to cut imports as refiners raised purchases in the first half ahead of sanctions and to honour 2011/12 deals.
The United States on Dec. 7 granted 180-day waivers on Iranian sanctions to China, India, South Korea and some other countries after they all cut oil purchases from Iran.
Iran’s share in India’s total imports was about 362,000 bpd in 2011-12 (April-March) from about 16.4 per cent or 436,000 bpd in 2008/09, bringing it down to third place among suppliers. It was replaced by Iraq after five years in the No. 2 slot.
Overall, India imported 3.5 million bpd of oil in December, up 5.4 per cent from a year earlier, while imports for the January-December period rose nearly 14 per cent to 3.64 million bpd to fuel expanding refining capacities.
To replace lost Iranian volumes, India imported about 87 per cent more oil from Latin America in the January-December period, with the region accounting for about 15.5 per cent of overall imports, up from about 9.4 per cent a year ago.
The Middle East region supplied about 63 per cent of India’s oil imports in January to December, compared with nearly 70 per cent a year ago.
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