India wants to keep Iran oil purchases at 300,000 bpd in extended waiver: sources

New Delhi: India wants to keep buying Iranian oil at its current level of about 300,000 barrels per day (bpd), as it negotiates with Washington about extending a sanctions waiver past early May, two sources in India with knowledge of the matter said.

India has reduced its purchases of Iranian oil but has been in talks on extending its sanctions waiver, a senior India official said in January.

New Delhi is asking to be allowed to still buy Iranian oil at current levels of around 1.25 million tonnes per month, or about 300,000 barrels per day, the sources said.

The United States reimposed sanctions against Iran in November last year in a dispute over Tehran’s nuclear and missile ambitions, after President Donald Trump pulled Washington out of a 2015 deal between Iran and six world powers.

Although the United States granted Iran’s biggest customers - China, India, Japan, South Korea, Taiwan, Turkey, Italy and Greece - waivers that have allowed them to continue limited imports, Washington is putting pressure on governments to eventually cut imports to zero. The current round of waivers expires around May 4.

Vincent Campos, a spokesman at the US State Department’s energy bureau, did not confirm that India was asking the United States to renew its waiver, but said talks are ongoing with the eight consumers of Iran’s oil that received waivers in November with the aim of eventually cutting the imports to zero.

“We continue to have bilateral discussions,” with each of the countries including India, Campos said.

Iran, a member of the Organization of the Petroleum Exporting Countries (OPEC), exported almost 3 million bpd of oil at its pre-sanctions peak, but supply has dwindled to around 1.25 million bpd since the start of the year, shipping data in Refinitiv showed.

Talks with Washington on extending the waiver slowed due to the US government shutdown that extended through January, one of the Indian sources said. Talks have now resumed and India wants to get clarity before general elections scheduled in May, the source said.

No immediate comment was available from India’s oil and external affairs ministries.

India’s move to seek extended sanctions exemptions comes as Washington plans to end preferential trade treatment for India that allows duty-free entry for up to USD 5.6 billion worth of its exports to the United States.

India is the biggest beneficiary of the Generalized System of Preferences (GSP), which dates from the 1970s, and ending its participation would be the strongest punitive action the United States has taken against the country since Trump took office.

Iran was India’s seventh biggest oil supplier in January compared with its position as third biggest a year ago before the reimpostion of sanctions.