‘India to continue buying Iranian oil despite sanction threat’

India is allowing state refiners to import Iranian oil with Tehran arranging tankers and insurance after firms including the country’s top shipper Shipping Corp of India (SCI) halted voyages to Iran due to US sanctions, sources said.

New Delhi’s attempt to keep Iranian oil flowing mirrors a step by China, where buyers are shifting nearly all their Iranian oil imports to vessels owned by National Iranian Tanker Co (NITC).

The moves by the two top buyers of Iranian crude indicate that the Islamic Republic may not be fully cut off from global oil markets from November, when US sanctions against Tehran’s petroleum sector are due to start.

US defense secretary Jim Mattis and secretary of state Michael Pompeo are scheduled to hold talks with their Indian counterparts Nirmala Sitharaman and Sushma Swaraj on Thursday and it is expected that the issue of implementing sanctions against Iran would be one of the key issues on the agenda.

“We have the same situation as most Western shippers because there is no cover, so we cannot go to Iran,” an SCI official told Reuters.

New Delhi turned to the NITC fleet after most insurers and reinsurers had begun winding down services for Iran.

The shipping ministry has given refiners permission to buy Iranian oil on a CIF (cost, insurance and freight) basis,” a government source said.

India, Iran’s top oil client after China, will finalize its strategy on crude purchases from Tehran after a meeting with top US officials this week, BusinessLine reported.