India Continues to Import Iranian Crude; Payments to be Made in Rupees

India, the world's third-biggest oil consumer, has decided to continue importing crude from Iran despite US threats to subject its companies to new financial sanctions, that are set to kick in on November 4.

Two Indian companies have already placed orders for next month's oil imports from Iran, according to India's Petroleum Minister Dharmendra Pradhan.

"Some of our companies have already nominated their quota for Iranian crude in November…," Pradhan told reporters on the sidelines of an event in New Delhi.

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According to Pradhan, over nine million barrels of oil are expected to be purchased in November. Sputnik had reported on October 5 that Indian Oil Ltd and Mangalore Refinery had placed a contract for 1.25 million metric tons of Iranian crude to be delivered in the month of November. As Iran gives Indian refiners a two month credit period, payments for the shipment will be made after November, in which the second set of US sanctions against trade with Tehran kicks in.

Pradhan said that the Indian government is not sure whether it will receive a waiver from the US sanctions on Iran.

"We are discussing with all authorities concerned on this issue. But we have to fulfill our own domestic requirement. We expect global leaders to understand India's needs," Pradhan added.

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Sanjiv Singh, Chairman of the state-owned Indian Oil Ltd said on Monday that the firm has booked its "usual quota from Iran in November" and that the payment would be made in the rupee.

"In the past also, Iran was open to payment in rupees, and that is one option," Sanjiv Singh added.

Last month, India's Minister of Shipping Nitin Gadkari had said that the Indian and Iranian banks that would be involved in the transactions have come to an understanding.

Payments will be made through Iranian private bank Pasargad, which was allowed to open a branch in Mumbai earlier this year. India's UCO Bank and IDBI Bank, which used to route payments during previous US sanctions on Tehran, will also be used as payment channels.

Last week, the US had reiterated its call upon India and other countries to cut oil imports from the Persian nation to "zero" by November 4 or face sanctions.