Iran deepens freight discount to boost oil sales to India — Sources

NEW DELHI: Iran has offered to raise the freight discount on oil sales to India in return for New Delhi agreeing to boost imports, as the Organisation of the Petroleum Exporting Countries (OPEC) member is keen to eat into the market share of other producers including top rivals Saudi Arabia and Iraq.

Iran is pushing to retain customers for its oil in Asia, hoping concessions will boost the appeal of its crude compared with other Middle Eastern suppliers, even as the threat looms of potential further US sanctions on the country.

Since the lifting of sanctions on Iran in 2016 it has been offering India a freight discount linked to a formula translating into 105 per cent of the Platts assessment.

For 2017-18 Tehran had reduced the discount to 62 per cent of the formula from 80 per cent, but Iran has offered to change this if Indian refineries step up purchases, three sources familiar with the matter said on Saturday.

“Now they are offering 100 per cent discount, meaning a sum equivalent to 105 per cent of the Platts freight assessment,” said one of the sources. — Reuters

Iran said it expected Indian orders to grow.

“State-owned Indian companies are going to increase their level of Iranian oil purchase,” Iran’s oil minister Bijan Zanganeh told reporters after a meeting with Indian oil minister Dharmendra Pradhan in New Delhi.

Indian refiners - state-owned and private - will buy about 500,000 barrels per day (bpd) of Iranian oil in 2018-19, said Zanganeh, in India as part of a delegation led by Iranian President Hassan Rouhani. In April through January, the first 10 months of this fiscal year, India imported about 17 per cent less Iranian oil at about 442,800 bpd. — Reuters