Iran said an Friday that oil payments dispute with India had been resolved by changing the currency of settlement, according to the country’s semi-official Fars news agency.
Central bank officials from Iran and India, keen to balance its energy needs with global diplomatic interests, met in Mumbai in an effort to keep their oil trade running.
“By changing the currency for oil transaction between Iran and India the problem was solved,” deputy oil minister Ahmad Khaledi was quoted as saying by Fars news agency.
The Reserve Bank of India said in a statement on Friday it met Iran’s central bank officials at a technical level to discuss facilitating trade transactions.
Indian officials and traders were hopeful of a quick resolution to the payments row that could disrupt about 13% of its oil imports and leave refiners scrambling for expensive alternative sources of crude.
The RBI said last week that oil trade payments to Iran could no longer be settled using a long-standing clearinghouse system run by regional central banks, and Tehran has refused to sell oil outside the old set-up. This week the RBI extended it to all current account transactions.
Other importers of Iranian crude include Indian Oil Corp and Mangalore Refinery and Petrochemicals Ltd and Essar Oil.
The White House, which wants governments to stop dealing with Iran because of its nuclear programme, has praised the move. UN sanctions on Iran do not cover oil sales.
India buys about 400,000 barrels per day of Iranian crude.