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Oil Inches Higher On Strong Crude Draw

Oil Inches Higher On Strong Crude Draw

Oil prices rebounded on Wednesday…

India Punishes Iran For Gas Field Decision Delay

Natural Gas

India is wagging its finger at Iran for delaying the license decision on a major gas field. Asia’s second-biggest oil market will reduce the amount of crude that it imports from Iran by 20 percent in financial 2017/18, media reported, quoting sources from the Indian oil sector.

The field in question, Farzad B, is estimated to contain over 350 billion cu m of natural gas, with its productive life seen at 30 years. Indian giant ONGC has submitted a $3-billion bid for the development of Farzad B, but Tehran is taking its time, waiting for rival—and potentially better—offers.

As a result, New Delhi has instructed local refiners to shrink the input from Iran to 190,000 barrels daily from 240,000 bpd – close to half of the total daily import rate for Iranian crude for the period from April 2016 to this February. In fact, Iran managed to get to the #3 spot among the top crude oil exporters to India, after Iraq and Saudi Arabia.

Tehran, however, appears to be unfazed. Evidently bolder now that it is once again on the global market and can choose among bidders for its oil and gas fields, the Iranian state oil company has struck back by threatening to reduce the massive discount it offers Indian importers, from 80 percent to 60 percent.

Iranian media recall that India was one of few countries that remained trade partners to Iran during the sanction years, supplying the country with a variety of otherwise inaccessible goods. Now that Iran’s fortunes have changed, it made clear its intention to expand its oil and gas industry as quickly as possible, apparently at the best possible price as well.

For Indian refiners, the Hindu notes, it is a bit risky at this moment, while OPEC shrinks production in a bid to stimulate prices. With Iran cutting the discount, they might find it difficult to find economical alternatives to the supplies from Tehran.

By Irina Slav for Oilprice.com

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  • Sepidar on April 04 2017 said:
    OilPrice is expected to quote the primary report (which is Reuters in this case), instead of referring to secondary media reports. Also be meticulous when using words such as 'license', especially amid all recent discussions on the IPC, which is definitely far from
  • Mata Bakhtiar on April 03 2017 said:
    When Iran was under a tight grip of Western economic sanctions, its people genuinely believed in the impartiality of New Delhi in their struggle against the West. That India could and would be a reliable working partner at the time: Little did the Iranians know!
    As it turned out to be, even during those dark years, New Delhi was using Iran's economic vulnerability to [The] absolute maximum; by demanding 80% discounts on almost everything they imported from that country. Moreover, to add salts to injury, even when it came to Iran's nuclear program, the Indians categorically sided with Iran's enemies and voted against Tehran at the UN. In this, we apportion the blame also on the inaptitude[ness] of some of those in authority in Tehran, for trusting the Indians; the way they did!
    Now, to the Indians, we say, it is high time, they should stop taking the Iranians for the sucker:
    In their most time of economic vulnerability and in such obvious but shameful manner; you used & abused the trust the Iranians had bestowed in you: The truth is, you now belong to the Zionist camp; let alone to be seen as Iran's partner in anything.
    In terms of foreign acquisition of Iran's future energy contracts, our simple piece of advice to the government in New Delhi is that all applications would have to follow the manner consistent with the international standard: No more discounts and [No] more bull-s**t!
  • Kaveh on April 03 2017 said:
    India is an agent of Israel these days

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