News ID: 231263
Published: 0229 GMT September 12, 2018

IOC books Iranian oil imports for October

IOC books Iranian oil imports for October

Indian Oil Corp. (IOC) booked for import of usual monthly quantity of 0.75-0.8 million tons of crude oil from Iran in October, a senior official said.

While India wants to continue importing Iranian oil, US Secretary of State Mike Pompeo last week stated that Washington would consider waivers on the embargo, PTI reported.

State refiners, however, have no advice from the government on Iranian imports yet, the official said.

IOC, he said, had planned to import of nine million tons of Iranian oil in the 2018-19 fiscal (April 2018 to March 2019).

"This comes to a monthly volume of 0.75 million tons and we have been doing similar kind of import till now, including in September. We have booked a similar volume of 0.75-0.8 million tons in October."

The official said, "We don't know yet what stance government of India will take. We have not been told to stop or cut down on imports from Iran as yet. We are importing oil on a monthly basis.

"We don't know what will happen in November. Perhaps there will be clarity before that."

Indian refiners buying from Iran benefit from 60 days credit, terms not available from suppliers of substitute crudes — Saudi Arabia, Kuwait, Iraq, Nigeria and the US.

The absence of payment mechanism may pose a challenge to the transportation of the oil as Iranian crude is bought on a CIF basis and shipped on Iranian tankers.

Under Cost, Insurance and Freight (CIF) mode of shipping, the seller assumes the responsibility of transportation and insurance. The liability and costs associated with successful transit are paid by the seller until the goods are received by the buyer.

India had planned to import about 25 million tons of crude oil from Iran in the current fiscal — up from 22.6 million tons imported in 2017-18.

While Iranian oil makes up for a very small volume in the basket of crude for HPCL and BPCL has stopped buying Iranian oil but for a different reason. It had contracted for around four million tons of Iranian crude for 2018-19. This included one million tons for its joint venture refinery at Bina in Madhya Pradesh.

Of the remaining three million tons destined for Mumbai and Kochi refineries, one million tons was on a firm basis and the remaining was optional. BPCL has taken all of the firm volumes already, as well as around one and a half million tons of the optional volumes, officials said.

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