India will Import Iranian Oil but how that is what Delhi is exploring. India is in talks with the European Union over alternative payment method for purchasing petroleum products from Tehran, said a source on Wednesday. As the US sanctions on the import of crude oil from Iran looms large, India is in touch with both Iran and the US on the complicated matter.
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The EU has been discussing with India that it was in the process of coming out with a payment solution as using US dollars for oil purchase will be restrained post-November 4 when the US sanctions come into force.
Till now, the 28-country bloc has not put forward a compact proposal for making payments to Iran for buying of oil. In May, the Trump administration had pulled out of the Iran nuclear deal and brought back economic sanctions against Tehran.
The US has told India and other countries to cut oil imports from the Gulf nation to “zero” by November 4 or face sanctions. India is yet to take a call on complying with the US sanctions on Iran.
However, India has been appraising the US about its energy demand to fuel its economy as well as the importance of Iranian oil. It has also been hoping that the US will give it some relief from the sanctions.
Earlier, India was looking at the likelihood of falling back on the rupee-rial arrangement for importing oil from Iran in the wake of US sanctions. The rupee-rial arrangement was used to purchase oil from Iran before sanctions were lifted against it three years ago.
Under the process, India used to pay in euros to clear 55% of its dues through Halk bank based in Ankara. The remaining 45% payment was paid in rupees in accounts Iranian oil companies had with the UCO Bank.
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