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Despite US Sanction, India to continue to purchase Iranian oil against rupee

Dharmendra-Pradhan

Oil Minister, Dharmendra Pradhan on Monday announced that India will continue to buy Iranian oil breaching the US Sanction, effective November.

The two-state refiners namely, IOC and Mangalore Refinery and Petrochemicals Ltd (MRPL) have ordered Iranian oil worth 1.25 million tonnes (MT) to be imported in November.

While addressing a gathering at The Energy Forum, Oil Minister, Dharmendra Pradhan stated, “Two of our oil companies have made nominations to purchase Iranian oil in November. We do not know if we will get a waiver (from US sanctions) or not. We will be guided by our national interest. We have ordered for our usual quantity of oil. Even without sanctions also, Iran had been accepting payments in the rupee. So let us see how it evolves”

The US sanction which will be implemented on November 4, 2018, will restrict using US dollar to be paid against Iranian oil imports. The Trump-government earlier this year declared a war and decided to bring Iranian oil export to zero by persuading other countries. The Ministry has not yet decided the mode of payment but according to a recent buzz, it is likely to pay using rupee. Iran may use Indian rupee to buy-back food items and other consumer goods from India.

Moreover, the crude oil amount nominated by India to be imported is far less than the expected amount of 25MT. Many oil refineries in India including Reliance Industries have withdrawn their order to import oil.

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