Iran exported 13.5% more oil to India in May compared with April as the country’s biggest refiner Indian Oil Corp resumed purchases of crude from Tehran after a three-month break.
News agency Reuters reported that India, Iran’s top client after China, imported about 255,200 barrels per day (bpd) of Iranian oil last month, down 0.6 %from a year ago, according to tanker arrival schedules from sources and data compiled by Thomson Reuters Oil Analytics.
Asian buyers are expected to import about 1.25 million-1.3 million bpd of Iranian oil in the six months through June, as China is taking more than it did before toughened sanctions were put in place in 2012.
Western powers had wanted to restrict Iranian oil exports to about 1 million bpd under the terms of the Geneva accord implemented on Jan. 20, but the deal’s silence on condensates has given refiners and Tehran an opportunity to trade in the light crude without breaching sanctions.
U.S. officials say that the Iranian exports exceeding 1 million bpd are within the tolerance of what is allowed because most of the overage is condensate bought by China and Japan.
India mainly takes standard crude grades from Iran, with only private refiner Essar Oil importing a small quantity of condensate.
India’s intake of Iranian oil in January-May rose about 38% from the previous year as refiners ramped up imports in the first quarter to meet a target of buying 220,000 bpd crude from Tehran in the fiscal year that ended March 31, 2014.
Indian refiners had the room to make the larger purchases in the first quarter due to deep cuts in calendar 2013 of nearly 40 percent, the largest reduction by Iran’s top clients – which besides China and India, also include Japan and South Korea.
State-run Mangalore Refinery and Petrochemical Ltd did not import Iranian oil for the April-July period in 2013 due to insurance problems triggered by western sanctions, while Hindustan Petroleum Corp Ltd halted purchases from the OPEC member and has yet to resume shipments.
Essar was Iran’s top Indian oil client in May, followed by MRPL, the data showed. IOC took one very large crude carrier, or 2 million barrels of Iranian oil last month, after not making any purchase from Tehran since January, the data showed.
Iranian oil accounted for about 6.5% of India’s overall crude purchases in May, the tanker arrival data showed. In comparison, Iran accounted for 16.4%t of India’s oil imports in 2008/09 and 5.7% in 2013/14.
Tehran was the sixth largest crude supplier to India in May, recovering from the eighth spot in April, the data showed.
Overall, India imported about 3.92 million bpd of crude May, down 5.7% from the last month, the data showed.
