‘India is willing to restrict its monthly purchase to 1.25 million tonnes or 15 million tonnes in a year, down from 22.6 million tonnes bought in the 2017-18 financial year.’
Beginning 5 November, the US administration under President Donald Trump will be imposing the “toughest ever” sanctions on Iran, which it said is “not intended at the Iranian people, but the authoritarian Iranian regime to change its behaviour”.
While announcing the sanctions, the US administration hinted at waiving off restrictions on eight countries from importing oil from Iran, which will bring a big relief to India as it is one among the eight nations allowed to continue buy Iranian oil.
Talking to media on Friday, Secretary of State Mike Pompeo said: “On 5 November, the United States will re-impose sanctions that were lifted as part of the nuclear deal on Iran’s energy, shipbuilding, shipping and banking sectors. These sanctions hit at core areas of Iran’s economy. These economic sanctions are just a part of the US government’s total effort to change the behaviour of the Iranian regime… They are necessary to spur changes we seek on the part of the regime.”
Local media reported about Trump’s tweet on the upcoming sanctions on Iran. On Twitter, in a message designed to emphasise his “maximum pressure” policy toward Iran, Trump included a photograph of himself modelled on an entertainment industry poster with the headline: “Sanctions are coming November 5.”
While senior officials refused to name the eight countries, but according to local media here in the US, India, South Korea and Japan are among the exempted nations, which shows the “closeness to the US administration”, say many on the Capitol. Pompeo said on Friday, citing “significant reductions” in imports of oil from the Persian Gulf nation. India is one of the countries expected to get the exemptions.
Local analysts say China, India, South Korea, Turkey, Italy, the United Arab Emirates and Japan have been top importers of Iran’s oil, while Taiwan occasionally buys cargoes of Iranian crude, but is not a major buyer. Under US law, exceptions can be granted for up to 180 days.
Reacting to the waiver, India’s Petroleum and Natural Gas Minister Dharmendra Pradhan on Saturday said, “India and other leading oil buyers would benefit from the US waiver they have been granted.”
Calling it India’s victory in putting its picture correctly to the world, Pradhan credited this to Prime Minister Narendra Modi’s personal equations with the US and his insistence “that interest of consuming nations cannot be overlooked”.
“That has been recognised by the US and it’s a big win. In the current geo-politically challenging scenario, India has managed to get its point convinced by international leaders. A country like India will benefit from this and India’s efforts will be beneficial to other consuming countries,” Pradhan said.
The US had previously wanted countries, including India, to completely halt oil purchases from Iran by 4 November when its full sanctions against Tehran come into force, but seems to have relented keeping in mind the global oil price crisis it can cause. Particularly for India, already battling a fuel price crisis ahead of the upcoming state and eventually the general elections, the exemptions are a big relief.
Pompeo added, “We expect to issue some temporary allotments to eight jurisdictions, but only because they have demonstrated significant reductions in their crude oil and cooperation on many other fronts and have made important moves towards getting to zero crude oil importation.”
India, which is the second biggest purchaser of Iranian oil after China, is willing to restrict its monthly purchase to 1.25 million tonnes or 15 million tonnes in a year (300,000 barrels per day), down from 22.6 million tonnes (452,000 barrels per day) bought in the 2017-18 financial year, sources said.
In May, President Donald Trump pulled the US out of the 2015 landmark Joint Comprehensive Plan of Action (JCPOA), terming it as “disastrous”. After the US’ withdrawal from the deal, Trump signed fresh sanctions against Iran and warned countries against any cooperation with Tehran over its controversial nuclear weapons programme.