IOC to clear 461 mn euro Iran outstanding by month-end

"We have over the past one week paid 73 million euros. Balance will be paid in 15-20 days," IOC Director (Finance) P K Goyal told reporters here.

The outstanding 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 last December, a move welcomed by US.

Goyal said IOC is the lowest among the four Indian refiners who buy crude oil from Iran. It buys 1.5 million tonnes or 30,000 barrels per day of crude oil from Iran. Of this, IOC has received 0.871 million tonnes till July end, he said adding there was no cargo scheduled for arrival in August. "We have one cargo of about 1,20,000 tonnes coming in September which is on schedule," he said.

Mangalore Refinery and Petrochemicals Ltd and Essar Oil - top two buyers of Iranian crude in India, last week made a payment of one billion euro through a Turkish state-owned bank, paving the way for resumption of supplies.

"Indian refineries' debt until last week stood at USD 4.8 billion, but we have now received about 1 billion euros of it," National Iranian Oil Co (NIOC) Managing Director Ahmad Qalebani was quoted as saying today by the state-run Fars news agency on Monday. "So in August, exports to India continued as in previous months".

Earlier, Iran, which supplies some 12 per cent of nation's oil needs, had threatened to stop oil shipments to India unless the past dues were cleared. Since then, Indian refiners have been looking at new conduit and the latest payments have been made through Turkey.

Goyal said the money is first transfered to a New Delhi branch of Union Bank of India which then routes euros equivalent to state-owned Turkiye Halk Bankasi (Halkbank) in Istanbul.

Halkbank has since transferred the money to the account of the National Iranian Oil Co (NIOC). "This is a mechanism that is working so far," he said.

These are the first payment Indian refiners have made to Iran since February when it had paid 1.5 billion euros through German-based Iranian bank Europisch-Iranische Handelsbank AG (EIH Bank). But soon after that payment, US convinced Germany to block that conduit.

India owes about USD 5 billion to their second biggest oil supplier after Saudi Arabia. MRPL is the largest buyer of Iranian crude, at 1,42,000 bpd, while Essar buys 1,10,000 bpd of oil from Tehran.