Here comes a piece of good news for the India oil refineries amid war in the Middle East. Indian oil refiners are now planning to resume purchases of Iranian crude oil after the US temporarily lifted sanctions to ease the energy crisis triggered by the Iran war. The Indian refiners who want buy Iranian oil are awaiting government directions and clarity from Washington on details such as payment terms. The oil refiners in India, which have small crude stockpiles than other big Asian oil importers, rushed to book Russian oil after the US recently lifted sanctions temporarily. In the meantime, the other Asian refiners are also making checks to see if they can purchase the oil, several people with knowledge of the matter said.
US lifts sanctions on sale of Iranian oil
Earlier in the day, the United States announced the temporary lifting of sanctions on the sale of Iranian oil stranded at sea in an effort to cool down soaring global crude prices. US Treasury Secretary Scott Bessent said the temporary measure will make available 140 million barrels of Iranian oil to global markets.
"This temporary, short-term authorisation is strictly limited to oil that is already in transit and does not allow new purchases or production," Bessent said in a long post on X.
Price of Brent crude has witnessed sharp swings
The price of Brent crude has witnessed sharp swings from roughly USD 70 per barrel before the war began to as high as USD 119.50 this week. "Today, the Department of the Treasury is issuing a narrowly tailored, short-term authorisation permitting the sale of Iranian oil currently stranded at sea," Bessent said.
The US official claimed that at present, sanctioned Iranian oil is being hoarded by China on the cheap. By temporarily unlocking this existing supply for the world, the United States will quickly bring approximately 140 million barrels of oil to global markets, expanding the amount of worldwide energy and helping to relieve the temporary pressures on supply caused by Iran, he said.
Pause on sanctions on Iranian oil to end on April 19
"In essence, we will be using the Iranian barrels against Tehran to keep the price down as we continue Operation Epic Fury," Bessent said. The pause on sanctions on Iranian oil loaded on vessels begins Friday and is set to end on April 19. Petrol prices have increased from USD 3 a gallon in the US before the war began to USD 3.99 on Saturday.
"This temporary, short-term authorisation is strictly limited to oil that is already in transit and does not allow new purchases or production," Bessent said. Further, Iran will have difficulty accessing any revenue generated, and the United States will continue to maintain maximum pressure on Iran and its ability to access the international financial system, he said.
So far, the Trump Administration has been working to bring around 440 million additional barrels of oil to the global market, undercutting Iran's ability to leverage its disruptions in the Strait of Hormuz, the US official said.
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