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Indian state-run refiners told Iran they would cut oil purchases by 3 million tons during the financial year that started April 1.
Indian state-run refiners told Iran they would cut oil purchases by 3 million tons during the financial year that started April 1.

Iran to Cut Benefits to Indian Refiners

India is using the supply glut to put pressure on Tehran for securing development rights to the Farzad-B gas field in the Persian Gulf

Iran to Cut Benefits to Indian Refiners

Iran will cut some benefits to Indian state-run refiners on crude purchases after the South Asian country decided to reduce the amount of oil it buys from the Persian Gulf nation, people with knowledge of the matter said.
National Iranian Oil Company will cut the credit period on crude oil sales to 60 days from 90 days for refiners such as Mangalore Refinery & Petrochemicals Ltd. and Indian Oil Corp., the people said, asking not be identified as the matter is not public yet, Bloomberg reported.
Iran will also reduce the discounts it offers on the shipping of crude to 60% from 80%, they added.
The lower incentives will make Iranian purchases costlier and less competitive in a world awash with crude oil where rivals such as Saudi Arabia and Iraq are seeking to expand their market share.
India is using the supply glut to put pressure on Tehran for securing development rights to the Farzad-B gas field in the Persian Gulf, which was discovered by an Indian consortium led by ONGC Videsh Ltd. about a decade ago.
Iran and India were aiming to conclude an agreement on developing the field by February. India, which stood by Iran during the sanctions, is seeking to invest as much as $20 billion in the country's energy industry and ports.
Indian state-run refiners told Iran last month that they would cut oil purchases by 3 million tons during the financial year that started April 1, the people said. MRPL and Indian Oil will reduce imports by 1 million tons each, while Hindustan Petroleum Corp. and Bharat Petroleum Corp. will cut purchases by about half a million tons each, according to the people.
India’s Oil Minister Dharmendra Pradhan said on April 6 that it is up to the state refiners to decide on Iran crude volumes.

--- Oil Imports Doubled
India's Iran oil imports jumped to a record high in 2016/17 topping half-a-million barrels per day as refiners boosted purchases after lifting of sanctions last year.
Refiners shipped in about 541,000 bpd of Iranian oil in the fiscal year to March, a growth of about 115% over the previous year, ship tracking data obtained from sources and data compiled by Thomson Reuters Oil Research & Forecasts showed.
India, Iran's biggest oil buyer after China, was among a handful of countries that continued to deal with Tehran under the sanctions.
India’s overall oil imports from Iran touched 19.8 million tons during April-December last year, compared with 12.7 million tons in the 2015-16 financial year, according to oil ministry data.
Iran was India's second biggest oil supplier - a position now belonging to Iraq - before economic sanctions aimed at Iran's nuclear program hampered its trade relations, forcing the South Asian nation to tap alternative suppliers.
Purchases by Indian refiners, including Reliance Industries that resumed imports last year after a multi-year lay-off, helped Iran regain some of the lost market share.
In March Iraq emerged as the second biggest oil supplier to India, a position it ceded to Iran the previous month. Saudi Arabia continued to be the top oil supplier to India in March.
In the first quarter of this year, India's oil imports from Iran surged by about 92% to 573,400 bpd as some OPEC producers had cut supplies, the data showed.

 

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