India’s oil imports from Iran plunge over gas field row

NEW DELHI: India’s oil imports from Iran have fallen to their lowest since June 2016, shipping data shows, in possible retaliation for Tehran not awarding a gas field development to Indian companies.

India, Iran’s top oil client after China, shipped in 487,600 barrels per day (bpd) in May, about 9 percent less compared with April and nearly 40 percent less than a peak registered in October, according to ship tracking data obtained from sources and data compiled by Thomson Reuters Oil Research & Forecasts.

Most Western-led sanctions against Tehran’s nuclear program were lifted in January last year, and India’s Iranian crude imports began climbing two months later in March.

In the fiscal year to March 2018, though, India has said it plans to order about a quarter less Iranian crude due to a snub over development of Iran’s Farzad B gas field.

“We stood by them in difficult times. We still buy substantial amounts of oil from them, and we expect reciprocity from Iran,” Indian Oil Minister Dharmendra Pradhan told reporters on Wednesday, when asked if India was still hopeful of getting the development rights for the Farzad B field.

Following years of seeming rapprochement over the field, Iran has likely reached an agreement on the concession with Russia’s state-controlled gas giant Gazprom, Russian and Indian media have reported.

Iran last month said India had not offered an acceptable proposal on the Farzad B development.

Sri Paravaikkarasu of energy consultancy FGE said India’s lower Iran imports were a “reaction of Iran’s decision to award the gas field to Russia and the availability of cheaper grades like those from Russia.”