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India yet to secure waiver from United States for oil imports from Iran

India is still in talks with the United States to extend Iranian oil sanctions waiver that would allow the South Asian country to import Iranian oil without any repercussions. India was granted a six-month waiver to purchase oil from Iran after US sanctions on Iran went into effect in November 2018 according to reports in the Iranian Media.

Indian officials are in negotiations with the United States government to extend a waiver beyond May 4

“We are engaging with the US. We have continued to engage with the US administration. The waiver lapses on May 4; let us wait and see what happens. But the important thing is, we will continue our engagement with the US to see if we are taking care of our energy security,” External affairs ministry spokesperson said last week.

In November, the US granted a six-month waiver to India, China, Greece, Italy, Taiwan, Japan, Turkey and South Korea to continue importing oil from Iran, as President Trump had the US unilaterally withdraw from the 2015 Iran nuclear deal and re-imposed sanctions on the country.

India, the world’s third largest oil consumer, meets more than 80 percent of its oil needs through imports. Iran is India’s third largest supplier, after Iraq and Saudi Arabia, and meets about 10 percent of India’s total need.

“India used to import about 9.4 percent of its crude from Iran. We have been gradually replacing that with Saudi crude and even US shale oil. However, price differentials are huge, especially as crude prices are firming up,” Indian officials involved in the negotiations were quoted in the media.“We will bring down our imports from Iran further, but for the time being, we need an extended waiver.”

The volume of trade between Iran and India stands between 10 to 13 billion US Dollars. Iran also plays an important role in India’s connectivity to Afghanistan via the Chabahar port along the Coastline of Iran.

The United States has pressured countries to reduce oil imports from Iran, threatening economic repercussions if they do not. This presents a problem for India, which is the second-largest Iranian oil buyer after China. It has limited India’s monthly purchases from Iran to 1.25 million tons, or 15 million tons per year (300,000 barrels per day).

 

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