India will soon begin purchasing crude oil from Iran as the United States is expected to ease sanctions on the Islamic republic that were imposed during the erstwhile Trump administration.
Indian refiners have started their preparatory work and will get into contractual agreements as soon as US and other countries restore the Iran nuclear deal at their meeting in Vienna, following which the sanctions could be lifted.
The mainstreaming of Iranian oil in global market is set to stabilise the overall prices and also assist India in diversifying its crude import, reports Economic Times.
“We have been advocating for oil producers to pump in more oil by easing output caps. Rising oil prices are a threat to the fragile economic recovery around the globe including in India,” a senior government official was quoted in the report as saying.
India was the second-largest importer from Iran but the Iranian crude import was halted by New Delhi following the imposition of sanctions in mid-2019.
Iranian crude is set to provide a longer credit cycle in addition to shorter voyage savings on freight costs to the customers.
Tehran gives a credit of 60 days on purchases, which is a term that is not available in crudes supplied from Nigeria, Iraq, US, Saudi Arabia and Kuwait.
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