Back to Markets
Commodities● Neutral
India Refiners Weigh Iranian Oil Discount vs Payment Risk
Iran offers a $3-4/bbl crude discount to India under a 60-day US waiver. Payment logistics and existing supply deals limit how much refiners can absorb. LPG flows offer an alternative.
Continue with
A 60-day U.S. sanctions waiver, granted Monday after initial peace talks, has reopened a narrow channel for Iranian crude sales to India. National Iranian Oil Co. and several intermediaries have approached Indian refiners offering barrels at a $3 to $4 discount to similar regional grades on a landed basis, two refining sources said.
The approaches come directly from NIOC and through small and mid-sized trading firms based in Singapore and Dubai. “Several traders are contacting us for Iranian oil. My priority is NIOC,” one of the sources said. The sources declined to be named because the discussions are confidential.
Indian refiners have limited room to take advantage. Most have already secured crude supplies through August, the sources said. Middle Eastern term suppliers are pressing buyers to honor annual contractual commitments. Any Iranian barrels would likely replace spot purchases, not term volumes. That could put pressure on other spot suppliers if deliveries go through.