Petroleum minister Dharmendra Pradhan on Monday said that two Indian oil refiners have contracted Iranian crude oil for November without having clarity on whether India will get a waiver from the US with regard to the impending sanctions on the Persian Gulf nation.
“There are various things being discussed with all concerned authorities and the world leadership have acknowledged that India’s domestic requirements need to be fulfilled,” added Pradhan while speaking at The Energy Forum workshop.
The US sanction on Iran will come into effect from November 4, 2018.
India is also considering payments to Iran for its crude oil in rupee terms, said Indian Oil chairman Sanjiv Singh.
Iran is the third-largest supplier of crude oil to India which procured 10% of its requirment from the Gulf country during 2017-18. Indian Oil has booked Iranian oil “as usual”, said Singh when asked about the quantity of oil bought.
Pradhan added that India today is in a position to be part of the international oil dialogue given its demand.
India is suffering due to high oil prices as well as a weakening rupee which has led to high retail fuel prices in the domestic market.
“We have discussed the issue of production increase with the oil minister of Saudi Arabia who reiterated that it will honour its decision to increase output as per a deal struck in June,” Pradhan said. An increase of 1 million barrel of crude oil production per day by Opec members may subdue the increasing oil prices in the international market.
Talking about the government’s decision to ask the oil marketing companies to absorb Rs 1 for every litre of diesel and petrol sold, Pradhan said the government companies have a social responsibility apart from making profits. While the government cut excise duty by Rs 1.50 per litre of the auto fuels, it asked the states to match the step.Some BJP-ruled states have already reduced VAT charged by it by Rs 2.50 per litre. The minister added that other states should also take part in providing relief to consumers.
Retail auto fuels pricing is based on trade parity formula taking into account international product prices. Singh added that the OMCs are a part of the oil pricing policy of the country and said the current Rs 1 discount on diesel and petrol is a temporary measure and fuel pricing remains deregulated.