India’s oil imports from Iran surged to about 705,000 barrels per day (bpd) in May, their highest level since October 2016, according to data from shipping and industry sources, despite the threats of fresh U.S. sanctions.
India’s Reliance Industries Ltd, owner of the world’s biggest refining complex, plans to halt oil imports from Iran, two sources familiar with the matter said, in a sign that new U.S. sanctions are forcing buyers to shun oil purchases from Tehran.
Government owned refiners plan to almost double oil imports from Iran in 2018-19, drawn by incentives offered by Tehran, sources with knowledge of the matter said, potentially helping Iran increase its share in the world’s third-biggest oil importer.
The pace of China’s oil imports growth is one of the most closely watched indicators in the industry—a gauge of the country’s huge appetite for oil and the impact it has on global oil trade and prices.
The October trade deficit has widened to a three-year high to $14.02 billion from $8.98 billion in September, while Oil imports rose by more than 27% as compared to the previous fiscal, the government data showed.
“There was heavy maintenance at some refineries in July-August. All those refineries have come online, so naturally refiners will have to boost purchases to meet local demand,” said Senthil Kumaran, senior analyst at energy consultant FGE.
India imported 335,400 barrels per day (bpd) oil from Iran in August, the lowest level since February 2016, posting a fall of about 42 percent from a year ago, according to ship tracking data obtained from industry sources and data compiled by Thomson Reuters Oil Research & Forecasts.
India’s oil imports from Iraq rose 31.5 percent in July from a month ago, shipping data showed, allowing the Middle Eastern country to retain the top supplier spot for the fourth consecutive month amid declines from sellers like the United Arab Emirates, Venezuela and Iran.
India’s Iran oil imports jumped to a record high in 2016/17 topping half-a-million barrels per day (bpd) as refiners boosted purchases after lifting of some Western sanctions against Tehran last year.
Iran’s oil minister dismissed India’s decision to cut oil imports from Tehran in 2017/18 by a fifth as a threat on Wednesday, in an escalation of a dispute over a giant gas field contract.