India's decision to resume buying Iranian crude oil hinges on the techno-commercial viability for its refiners, according to a senior Petroleum Ministry official. The U.S. recently suspended sanctions on Iranian crude already loaded on tankers, allowing up to 170 million barrels of Iranian oil to flow into the global market. This move aims to stabilize oil prices amid tensions in the Middle East, where the Strait of Hormuz—a critical oil transit route—has been effectively closed due to conflict. The U.S. Treasury’s Office of Foreign Assets Control (OFAC) authorized transactions related to Iranian crude oil and petroleum products until April 19, covering shipments loaded on tankers before March 20. However, challenges remain for buyers like India, as Iran and its banks are excluded from the SWIFT financial network, complicating payments. Previously, a Euro-based payment system was used, but it collapsed after major buyers halted imports following Trump-era sanctions. India’s refiners will assess whether purchasing Iranian crude is feasible, given the current geopolitical and economic landscape. The country’s reliance on oil imports—over 88% of its crude needs—has been strained by the Strait’s closure, which disrupted 20% of global oil and LNG flows. While alternative routes have partially mitigated the impact, the U.S.-sanctioned Iranian oil continues to transit through the Strait, according to industry analysts. Historically, India was a major buyer of Iranian crude, importing 22.1 million tonnes in 2009-10, which accounted for 14.4% of its total oil imports. However, tightening sanctions and logistical hurdles reduced imports to 11.2 million tonnes by 2014-15. The 2016 nuclear deal lifted sanctions, leading to a surge in Iranian oil imports, which peaked at 27.1 million tonnes in 2016-17.#iran #india #strait_of_hormuz #petroleum_ministry #ofac
