India Has Paid Two-Thirds Of Iran Oil Import Arrears: Report.

TEHRAN/NEW DELHI: India has paid two-thirds out of nearly $5 billion in arrears related to crude oil imports from Iran, according to Iranian Central Bank Chief Mahmoud Bahmani.

India has paid off two-thirds of its oil debt to Iran, Bahmani was quoted as saying by Iranian news agency ISNA on Monday.

"Iran is receiving the remaining amount of the debt from India and there is no problem in this regard," he said.

In June, Iran, which supplies some 12 per cent of India's oil needs, had threatened to stop oil shipments to the country from August unless past dues totalling $5 billion were cleared.

The dues had accumulated after the Reserve Bank of India last December scrapped a long standing mechanism of paying for Iranian oil through a clearing house system run by regional central banks.

The payment mechanism for Iranian oil was stopped amid the US slapping sanctions on Iran over the country's alleged nuclear weapons programme.

According to Bahmani, Iran and India have discussed India paying for some of its oil in gold.

"Such talks have taken place and we will do that if necessary," he noted.

Four Indian refiners import oil from Iran. Mangalore Refinery and Petrochemicals Ltd (MRPL) is the largest buyer of Iranian crude, at 142,000 bpd, while Essar buys 110,000 bpd of oil from Tehran. Hindustan Petroleum Corp Ltd (HPCL) and Indian Oil Corp (IOC) buy 3.35 million tonnes and 1.5 million tonnes of crude oil, respectively, from Iran.

Last Friday, HPCL said it has paid $150 million to Iran using a newly established conduit through Turkey and would clear the remaining oil dues, totalling over $1 billion, by next month.

"Our outstanding (dues) toward Iran is $1.014 billion after payment of $150 million earlier this month," HPCL Director (Finance) B Mukherjee had said.

Last week, IOC said it had repaid 73 million euros of its outstanding dues and would pay the remaining 388 million euros by the month end.

MRPL and Essar Oil had made a total payment of 1 billion euros toward their oil purchases from Iran through a Turkish state-owned bank, paving the way for resumption of supplies to their refineries.

Source : economictimes.indiatimes.com