New Delhi: US sanctions on Iranian crude oil are credit negative for Indian refiners, said global rating agency Moody’s.
“We expect Indian refiners will either have to significantly reduce or completely stop importing crude oil from Iran over the next month or so. As a result, Indian refiners will increase dependence on the remaining Middle Eastern crude oil suppliers (mainly Saudi Arabia and Iraq), aside from Iran,” it said.
The rating agency said that Iranian crude is usually sold at a discount of up to $2-$4 per barrel to other Middle Eastern crude oil grades. Iran’s national oil company, National Iranian Oil Company, also subsidises the freight costs for crude oil delivery and offers extended payment terms to buyers, it said.
Moody’s said that India is one of the largest buyers of Iranian crude, accounting for about 30 per cent of total crude exports from Iran during April to August 2018.
