India to resume buying oil from Iran once US sanctions ease: Official

As the US and other world powers are meeting in Vienna to revive the Iran nuclear deal, the Indian administration is hopeful of buying oil from Iran once the sanctions on the Persian Gulf nation are lifted.

New Delhi: India will look to resume buying crude oil from Iran the moment US sanctions are eased, a senior government official said.

The comments assume significance as the US and other world powers are meeting in Vienna to revive the Iran nuclear deal.

India stopped importing oil from Iran in mid-2019 following sanctions on the Persian Gulf nation by the Trump administration.

"Once the sanctions are lifted, we can look to resume oil imports from Iran," the official, who did not wish to be identified, said.

Indian refiners have begun preparatory work and can swiftly enter into contracts once the sanctions are lifted, he said.

"We already have a template for commercial terms and we can very quickly enter into contracts the moment Iran is cleared for exporting oil," he added.

Iranian oil coming into the market will not just cool prices but also help India diversify its import basket.

Pump prices of petrol are above Rs 100 per litre in many parts of the country and diesel is sold above Rs 90 per litre in all the major metros.

Iranian exports tumbled after former US President Donald Trump tightened sanctions in 2018 and ended waivers for some countries in 2019, including India.

Iran re-started the banned nuclear programme after Trump pulled out of the deal and re-imposed sanctions on Iran.

Even though new US President Joe Biden wants to rejoin, both sides say the other must make the first move.

In fact, during his election campaign last year, Biden committed to reviving the Iran nuclear deal saying, “I will offer Tehran a credible path back to diplomacy.”

Biden also played a major role in formulating the Iran nuclear deal as the Vice President in the Barack Obama administration. The deal paved the way for lifting sanction on Iran.

However, the sanctions were re-imposed as the Donald Trump administration withdrew from the deal.

With Joe Biden in the oval office, the Indian administration is optimistic about reviving its oil trade with Iran.

“As a buyer, I would like to have more buying places. I should have more destinations to go for purchasing (oil),” Union oil minister Dharmendra Pradhan told the media recently in response to a question if he wants the Biden administration to relax sanctions on Iran.

(With PTI Inputs)