Iranian oil imports: India to weigh purchases after US 30-day sanctions waiver

India is weighing a return to Iranian oil purchases after the United States briefly eased sanctions. A senior government official said the decision will depend on costs and operational fit. The waiver followed a rise in crude prices after the US-Israeli war on Iran. Officials and analysts said payment and logistics limits still shape any possible trade.

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At a briefing on West Asia, Sujata Sharma, Joint Secretary at the Ministry of Petroleum and Natural Gas, linked any move to practical factors. Sharma said: "It is based on techno-commercial feasibility,\". The ministry is assessing whether refiners can buy Iranian crude at workable terms. Price, shipping, and risk conditions will remain key.

Iranian oil sanctions waiver and India’s purchase options

Over the weekend, the US allowed a 30-day waiver for buying Iranian oil at sea. The step aimed to cool prices after the war-related spike. An estimated 140 million barrels of Iranian oil is on vessels on sea. The waiver may let buyers access those cargoes. However, the method for making payments is still unclear.

Iran remains outside SWIFT, the Society for Worldwide Interbank Financial Telecommunication. SWIFT is a global bank messaging system for secure payment information. Iran was removed in March 2012 after European Union sanctions over the nuclear programme. In 2018, US sanctions returned and several Iranian banks were suspended again. This reduced trade flows and blocked many oil payments.

Iranian oil payments, SWIFT limits and trade hurdles for India

Industry sources said earlier Indian purchases used Euros through a Turkish bank. That route is no longer available, according to the same sources. Without SWIFT access, buyers and sellers face added complexity. Insurance and shipping also become harder under sanctions rules. These barriers may outweigh any price benefit from the waiver.

Iranian oil imports history and India’s refinery compatibility

India earlier bought large volumes of Iranian crude, including Iranian Light and Heavy grades. Refiners used these grades due to good compatibility and favourable trade terms. At its peak, Iranian crude formed 11.5 per cent of India’s total imports. After sanctions tightened in 2018, India stopped imports from May 2019. Replacement barrels came from the Middle East, the US, and other suppliers.

Iranian oil supply on water and India demand outlook

Sumit Ritolia, an analyst at Kpler, said India could become a demand centre to watch. Ritolia also pointed to Chinese buyers and other Asian countries. Ritolia said Iranian crude availability stays high, with about 170 million barrels on water. This includes floating storage and cargoes moving to buyers. While some volumes are committed, some remain unsold.

Ritolia said Indian refiners can take these barrels with limited operational changes. Ritolia cited past processing and existing trading setups as support. Ritolia added that decisions will rely more on pricing and politics than technical issues. Key checks include how long sanctions relief lasts, shipping rules, and payment options. Insurance and logistics terms also matter.

If workable terms emerge, Indian buying could rise quickly, Ritolia said. Ritolia compared the possibility to the jump in Russian crude intake after Western sanctions eased. For now, officials said India will decide only after assessing feasibility. The waiver offers a short window, but banking limits and trade mechanisms remain central. Any restart will depend on how these conditions evolve.

With inputs from PTI