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No decision to stop oil to India yet: Iran

Iran has no plans yet to cut oil exports to India over a payment dispute, the semi-official Mehr news agency on Friday quoted an oil official as saying.

business Updated: Jul 22, 2011 21:52 IST

Iran has no plans yet to cut oil exports to India over a payment dispute, the semi-official Mehr news agency on Friday quoted an oil official as saying.

Iran warned India on Monday that it would stop exporting oil to India from August 1 if the seven-month-long dispute over payments of Iranian oil exports was not resolved.

"No decision has been made yet... the caretaker oil minister Mohammad Aliabadi will make the final decision on it if the dispute is resolved in the next few days," said Mohsen Ghamsari, head of the international affairs office at the National Iranian Oil Co (NIOC). http://www.hindustantimes.com/Images/HTEditImages/Images/23_07_biz2.jpg

NIOC, which supplies around 12% of India’s oil imports, set the deadline in a letter dated June 27 to Indian refiners.

Iran and India have been looking to resolve an impasse triggered in December when the Reserve Bank of India ended a regional clearing mechanism under US pressure.

Since December 2010, India and Iran have been trying to find ways for New Delhi to pay for 400,000 barrels per day (bpd) it buys from the Islamic state.

Iran is putting pressure on India to accelerate the resolution of the payments mechanism dispute, analysts said.

India owed Iran $5 billion for oil imports in recent months, according to the Iran government. Earlier this year, Germany allowed India to pay for the oil via Hamburg-based EIH bank, which handles international trade for Iranian companies.

But India halted that conduit in early April after EIH came under EU sanctions.