India has said it is prepared to deal with the impact of the U.S. decision to not extend the waiver it had until today to import oil from Iran that’s currently under U.S. sanctions. The sanctions require New Delhi to reduce its oil imports to zero from Iran, a major supplier of the fossil fuel to India.
In February, Petroleum Minister Dharmendra Pradhan had tweeted that the government had “put in place a robust plan for adequate supply of crude oil to Indian refineries. There will be additional supplies from other major oil producing countries; Indian refineries are fully prepared to meet the national demand for petrol, diesel & other petroleum products”.
External Affairs Ministry Spokesperson Raveesh Kumar told reporters on Thursday that the factors which will determine India’s decisions with regard to oil imports are energy security, commercial considerations and legitimate economic interests. He also said India has in place a robust plan that will enable oil imports from other countries.
Regarding the amount of oil India will now need to import from other countries to meet the shortfall, the spokesperson said these are a matter of operational detail.
While India has prepared to deal with a situation wherein it will not be able to import any oil from Iran for fear of sanctions, the going is not expected to be easy as this is expected to push up domestic oil prices and also fuel inflation. While India had been hoping for an extension of the oil waiver and was in regular consultation with the U.S. on this, it was clear by late April that this would not happen. U.S. Secretary of State Mike Pompeo announced that no additional Significant Reduction Exceptions (SREs) would be issued to countries importing oil from Iran.