India is on track to receive a delivery of crude oil from Iran this week. The shipment is arriving following a reroute of a tanker, originally bound for China but redirected to Indian shores. This marks the end of a seven-year hiatus in Iranian oil imports by India after the temporary lifting of sanctions by Washington to stabilize global oil supplies.
According to shipping data from the London Stock Exchange Group (LSEG) and Kpler, the very large crude carrier Jaya, flagged in Curaao, has been chartered to transport Iranian crude to India’s east coast. The vessel’s route indicates a change in direction, initially heading towards Southeast Asia, potentially China, before altering course towards India.
Indian Oil Corporation (IOC) has secured the cargo but has not yet responded officially to inquiries about this development. Additionally, another tanker named Jordan is also indicating India as its discharge point, as reported by Reuters.
The resumption of Iranian oil imports by India comes after a halt in May 2019 due to US sanctions, forcing Indian refiners to seek alternative sources. The recent supply disruptions in West Asia have further emphasized the need for diversification in oil sources, prompting Indian refiners to reconsider Iranian crude.
Despite the ceasefire agreement between the US and Iran, the purchase was finalized earlier this month. The oil ministry has confirmed that Indian refiners have started sourcing crude from Iran, with payment mechanisms posing no current obstacles due to temporary sanctions relief, facilitating smoother trade flows.
The reintroduction of Iranian crude into India’s oil imports is seen as a potential relief for refiners navigating through volatile prices and supply uncertainties. This development signifies a strategic shift in India’s energy sourcing amid global geopolitical dynamics.