india

Updated: Apr 30, 2019 09:04 IST

External affairs minister Sushma Swaraj spoke to her US counterpart Mike Pompeo on Saturday about flexibility in US sanctions on Iranian oil imports but America’s top diplomat was non-committal, people familiar with developments said.

During the phone call, Swaraj said India should be allowed to import Iranian crude for some more time without being impacted by US secondary sanctions as the general election is underway in the country, and that the next government with a fresh mandate will take a final call on this issue, the people added, asking not to be identified.

Swaraj explained India’s political and economic conditions to Pompeo and sought some relaxation as making immediate arrangements for 23.5 million tonnes of oil – the amount supplied by Iran every year – from an alternative source was not possible, the people said.

However, Pompeo did not make any commitment and told Swaraj the matter was no longer handled at his level as a decision had been made by the US administration to strictly enforce sanctions, the people added.

Pompeo and Swaraj were initially scheduled to speak a day before the US secretary of state announced on April 22 that the Trump administration will no longer grant exemptions from sanctions to any country importing Iranian oil. The call could not go through only because of “scheduling issues” and the two leaders finally spoke on Saturday, said another person familiar with developments.

The conversation was part of regular bilateral consultations and the two leaders also touched on issues to strengthen the India-US strategic partnership, the person added, asking not to be named.

India, which imports more than 80% of the crude oil it processes, gets about 10% of its supplies from Iran on concessional terms, including deferred payments and shipping at the expense of Tehran. Indian officials had held extensive consultations with their American counterparts about an extension of the six-month exemption from sanctions announced last November and were expecting a positive outcome. In November, the US granted exemptions, known as “Significant Reduction Exceptions”, to China, India, Italy, Greece, Japan, South Korea, Taiwan and Turkey for six months. Turkey and China, the two other largest importers of Iranian oil, have no plans to comply with the US demand to go to zero by May 2, when the exemptions end.

The US decision not to give further exemptions to the sanctions is expected to disrupt energy supplies from Iran.

However, the Indian government said last week it had put in place a “robust plan” to ensure the US sanctions don’t affect supplies of crude oil to refineries. India also said it will continue to work with partners, including the US, to protect the country’s energy security.

The US has conveyed to India that its decision will affect Washington’s friends and partners but was intended to put maximum pressure on Iran, people familiar with developments said. The ending of the exemptions was not aimed specifically at India or intended to pit India against Iran, they added.

Global oil prices, which spiked after the April 22 statement, have seen a downward trend since April 26, after the American assurance on the supply situation. Benchmark Brent crude fell by eight cents to $72.07 per barrel on Monday. Last week, the White House issued a statement reiterating its decision to bring “Iran’s oil exports to zero and deny the regime its principal source of revenue”. The statement also said that the “three of the world’s great energy producers” were working to ensure global oil markets remain well supplied.