India Moves Swiftly as U.S. Temporarily Lifts Iran Oil Sanctions: Refiners Race to Resume Purchases

Following the temporary suspension of U.S. sanctions on Iranian oil, Indian refiners have mobilized immediately with plans to resume procurement. Other refiners across Asia are reportedly weighing similar moves.

Indian Refiners Lead the Charge

Three Indian refining executives confirmed they intend to purchase Iranian crude and are currently awaiting government directives and further clarification from Washington regarding payment terms and logistical specifics.

 

Historically, the primary buyers of Iranian crude included India, South Korea, Japan, Italy, Greece, and Turkey. Given that India’s crude inventories are significantly lower than those of other major Asian importers, its refiners have already been aggressively snapping up Russian barrels following recent similar temporary sanctions relief from the U.S.

 

Sources familiar with the matter indicated that other Asian refiners are still conducting due diligence to determine the feasibility of re-entering the Iranian market under the new guidelines.

 

On Friday, U.S. Treasury Secretary Scott Bessent announced that the Trump administration has issued a 30-day sanctions waiver, permitting the purchase of Iranian oil already in transit at sea. According to the Treasury’s statement, the waiver applies to oil loaded on or before March 20 and discharged by April 19. This marks the third temporary sanctions exemption issued by the U.S. since the onset of the conflict with Iran.

Unlocking 140 Million Barrels

Secretary Bessent noted that by temporarily releasing existing supplies, the U.S. aims to rapidly inject approximately 140 million barrels of oil into the global market.

 

Emmanuel Belostrino, Senior Manager of Crude Market Data at Kpler, estimates there are currently about 170 million barrels of Iranian crude at sea.

 

Energy Aspects offers a slightly more conservative estimate of 130 million to 140 million barrels, noting this volume represents less than 14 days of the total Middle Eastern supply deficit.

 

Asia relies on the Middle East for 60% of its crude supply. The near-closure of the Strait of Hormuz this month has already forced regional refineries to slash operating rates and curtail fuel exports.

Logistical Hurdles Remain

Traders warn that purchasing Iranian oil remains complex due to uncertainties surrounding payment mechanisms and third-party contractual obligations.

 

"Processing compliance, administrative, and banking requirements typically takes time," said a Singapore-based trader. "However, I expect market participants to move as quickly as possible to capitalize on this window."