New Delhi (Sputnik) — India's Ministry of External Affairs on Monday said that it is studying the implications of the US decision to end the waiver on the purchase of Iranian crude with effect from 2 May. India has stated that it will make a decision only after giving the matter due consideration.
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"We have seen the announcement by the US Secretary of State. We are studying the implications of the decision and will make a statement at an appropriate time", a source in India's Ministry of External Affairs told Sputnik.
Meanwhile, an Indian energy expert believes oil imports an absence of Iranian oil would drive up oil purchase costs for India, as oil refineries have to follow the US sanctions due to their exposure to the American market.
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"It's not that oil is bought by governments, the ones buying oil are corporations. These corporations have sizeable exposure in US also. They need funding. They need reserves and have to have forex as working capital to meet their business needs. Each of these oil buying companies have to work out for themselves whether they can afford to be caught on the wrong side of US sanctions", Amit Bhandari, energy expert at Indian Council of Global Relations (Gateway House), told Sputnik.
Indian refineries used to prefer the Iranian crude due to cost effective availability, as Tehran offers 60-day credit, free insurance, and shipping.
In November 2018, Washington granted six-month waivers from oil sanctions on Tehran to eight countries dependent on Iranian energy imports, including India. On Monday, the White House announced the decision not to reissue waivers on Iranian oil after they expire in May.