India will not cap oil imports from Iran

Discussion in 'Subcontinent & Central Asia' started by nrj, Apr 11, 2013.

  1. nrj

    nrj Stars and Ambassadors Stars and Ambassadors

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    NEW DELHI: India is unwilling to impose restrictions or cap its oil imports from Iran, and will continue its energy ties with Tehran as long it gets a "good deal" and logistic support, even as one national insurance companies has stepped in provide reinsurance for oil imports from Iran staving a crisis for now, senior government officials told reporters on India's energy strategy.

    New Delhi's reiteration of continuing oil imports from Iran comes even as crude oils imports from Iran has been slowing down in view of the US pressure to bring down trade ties with Tehran. India imported 12% of its oil requirement from Iran. India's stand on energy security comes even as it assumes increased significace in the foreign policy and trade relations. Prime Minister Manmohan Singh, back from the BRICS summit a month ago, is on his way for an inter-government conference with Berlin.

    Two Indian insurance companies General insurance Corporation RE have recently agreed to provide insurance to the oil imports from Iran, thereby removing a great hurdle in oil imports.

    Lack of logistic support, particularly in financing, has over the months created problems for Indian refining companies, some of which like Chennai Refineries are configured to give the best production yields on Iranian crude oil. The Reserve Bank of India (RBI) had to work out special payment channels for the Iranian oil imports as restrictions were imposed on dollar trade with Tehran.

    India is also seeking to diversify its oil import basket and the emergence of Iraq as a key oil exporter in recent times has shifted the domestic oil axis significantly, one of the government officials in direct knowledge of the trade said. India, is however, unlikely to officially admit that imports from Iran are being gradually reduced following the mounting US pressure.

    Reliance IndustriesBSE 0.61 % Ltd ( RILBSE 0.61 %), the country's largest private oil company used to export a large portion of their petroleum produce, primarily gasoline, to Iran a few years back. But financing difficulties arose when most leading banks and financial institutions from the developed countries refused to be associated with Iranian trade.

    Talks of an India-Pakistan-Iran pipeline, that was proposed to ensure regular oil supplies to energy starved India, too has almost fallen through with it remaining a paper project. India is instead negotiating with Turkmenistan Afghanistan and Pakistan for a cross country pipeline. Plans of importing some of Iran;s natural gas as liquefied gas too is now in cold storage even Indian oilBSE 0.31 % companies led by ONGC Videsh Ltd (OVL) wait to begin production frokm their oilfield at Farsi.


    India will not cap oil imports from Iran: Govt Officials - The Economic Times
     
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  3. Armand2REP

    Armand2REP CHINI EXPERT Veteran Member

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    Well the conditions are as long as it gets a good deal. Even if India is providing insurance, they will still demand market rates forcing Iranian exporters into a corner.
     
  4. pmaitra

    pmaitra Moderator Moderator

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    With the number of importers reduced, Iran will not have any problems with the market rates, because, they are getting the market rate, and they also need liquidity. I don't see how this pushes Iran into a corner.
     
  5. arnabmit

    arnabmit Homo Communis Indus Senior Member

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    Last edited: Apr 11, 2013
  6. Armand2REP

    Armand2REP CHINI EXPERT Veteran Member

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    You don't see how this will push them into a corner when India is the only one willing to offer them insurance? The market rates for Iran are almost triple.
     
  7. pmaitra

    pmaitra Moderator Moderator

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    You're saying the market rate of one barrel of Iranian crude is three times that of Saudi crude? I didn't know that.
     
  8. amoy

    amoy Senior Member Senior Member

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    I think he means the reverse as Iran's MARKET is limited to a few buyers now
     
  9. pmaitra

    pmaitra Moderator Moderator

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    Ok, so then his claim that India buying from Iran at market prices will push Iran into a corner makes no sense to me.
     
  10. amoy

    amoy Senior Member Senior Member

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    His full sentence >>> You don't see how this will push them into a corner when India is the only one willing to offer them insurance?

    IF India is the ONLY one as A-R claims then Iran is really cornered
     
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  11. pmaitra

    pmaitra Moderator Moderator

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    Ok, I see what you are saying.

    I was looking at it this way. Since no one (with exceptions) wants to trade with Iran, Iran is already in a corner, and India willing to (. . .) will actually help them.
     
  12. arya

    arya Senior Member Senior Member

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    old new already posted


     
    Last edited by a moderator: May 10, 2015
  13. nrj

    nrj Stars and Ambassadors Stars and Ambassadors

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    Renewed resolve to continue imports is result of RBI stepping in. IOB route did not work much it seems.
     
  14. W.G.Ewald

    W.G.Ewald Defence Professionals/ DFI member of 2 Defence Professionals

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    PressTV - India to continue Iran oil imports despite sanctions: Report

    Mention of US sanctions does not seem to appear in article posted by nrj, which implies.... what?.
     

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