India may be wilting under US pressure after all, despite the sound bytes to the contrary by the govt.
India's crude oil imports from Iran declined by about 34 percent in April compared with March, deeper than expected and the first evidence of New Delhi implementing cuts in supplies from the sanctions-hit nation under annual deals that began last month.
State-run buyers are at the forefront of reductions, leaving privately-owned Essar the biggest Indian client of Iran, tanker discharge data showed, just as the U.S. praised steps taken by India's refiners to back Washington's pressure on Tehran.
The U.S. has already granted waivers to the sanctions for Japan and 10 European countries but has left out China and India, Iran's biggest clients.
U.S. Secretary of State Hillary Clinton said on Monday India needed to do more and said a decision on granting a waiver was around two months away.
India's total oil imports from Iran in April fell to about 269,000 barrels per day (bpd) from 409,000 bpd in March and from about 449,000 bpd in April 2011, the data made available to Reuters showed on Tuesday.
Overall in the last contract year to March 31, 2012, India's purchases of crude from Iran were expected to be under 340,000 bpd, India's foreign secretary Ranjan Mathai said in March. Estimates compiled by Reuters based on company plans in July 2011 were for up to about 380,000 bpd.
Indian refiners are expected to cut volumes from Iran by over 20 percent in this contract year on average, Reuters reported in March.
The shortfall is being made up with extra barrels from the world's biggest exporter, Saudi Arabia, as well as Iraq, which has leapfrogged Iran to be India's No. 2 supplier, among others.
Clinton said Washington was working with New Delhi to find replacements for Iranian oil when she was visiting India this week.
We commend India for the steps its refineries are taking to reduce imports from Iran and we have also been consulting with India and working with them in some areas on alternative sources of supply, Clinton said on Tuesday, while keeping up the pressure for even more.
Saudi Oil Minister Ali al-Naimi on Tuesday said the top oil exporter is pumping around 10 million bpd and is storing 80 million barrels to meet any sudden disruption in supplies.
The Kingdom stood ready to tap into its spare capacity of 2.5 million bpd if more crude was needed, he added.
Imports from Iran in January-April surged by almost a quarter to 405,000 bpd compared with last year when lifting of Iranian oil slowed due to payment problems caused when a finance conduit was closed under U.S. pressure.
In the first four months of this year, Iraq has emerged as India's second biggest supplier of oil replacing Iran, followed by Kuwait, Nigeria and the United Arab Emirates. Saudi Arabia continued to be the biggest oil supplier to India.
India's overall oil imports in January-April rose about 10 percent from a year ago as the country expanded its refining capacity. Total oil imports in April declined 5.7 percent from March and 2.2 percent from April last year, the data showed, after stockbuilding in February and March.
India aims to raise its refining capacity from the current 4.3 million bpd to about 6.22 million bpd by 2016/17, while the local fuel demand is expected to rise to 152.94 million tonnes, Oil Minister S. Jaipal Reddy told lawmakers on Tuesday.
Source : indianexpress.com