India unlikely to speed-up Iranian oil purchase without deep discounts:US sanctions waiver runs for 60 days

Indian refiners are unlikely to significantly increase purchases of Iranian crude despite a temporary easing of US sanctions, as uncertainty over the duration of the waiver, payment constraints, and existing supply commitments limit the scope for new buying, according to a market analyst, reported news agency, PTI. US provides 60-day sanction on Iranian oil The United States has provided a 60-day sanctions waiver that temporarily allows Iranian crude exports, but the short timeframe is unlikely to trigger a broad return of buyers beyond China, said Sumit Ritolia, who models refinery and oil markets at Kpler. Reason: Indian refiners have already secured much of their crude requirements for the coming months, with procurement plans typically finalised two to three months in advance, Ritolia said. State-run and private refiners are currently sourcing cargoes for late August and September, with Russian and Middle Eastern grades continuing to dominate purchases. Venezuelan crude has also been gaining market share. While refiners could make opportunistic purchases if Iranian crude is offered at steep discounts, existing supply availability from Russia and the Middle East reduces the need to alter procurement strategies, he said. Opportunistic purchases are possible if discounts become highly attractive, but the overall scope appears limited. The waiver may have reopened the door for Iranian exports, but that does not automatically create a broad pool of buyers. -Sumit Ritolia, Kepler Iranian oil share in India’s crude basket peaked at 11.5% Historically, India was a major buyer of Iranian crude, importing significant volumes of Iranian Light and Heavy grades due to strong refinery compatibility and favourable commercial terms. Following sanctions tightening in 2018, imports ceased from May 2019, with volumes replaced by Middle Eastern, US and other grades. At peak, Iranian crude accounted for 11.5% of India’s total imports. ​