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China and India slash oil import from Iran

India and China imports

India shipments from Iran fall over 40 percent from June and a year ago

August 22, 2012 8:40 by

Iran’s biggest oil buyers, China and India, sharply cut their imports in July, official data from the two countries on Tuesday showed, as Tehrancustomers came under further pressure from Western sanctions and faced big shipping complications.

China’s crude oil imports from Iran fell nearly a third in July from an 11-month high in June, while shipments by India, the world’s fourth-largest oil consumer, fell over 40 percent.

Cuts have secured the two major oil consumers a waiver from the United States on financial sanctions targeted at Tehran.

The United States and Europe have levied tough sanctions on Iran in a bid to choke off oil revenues and halt a controversial nuclear programme the West fears is aimed at developing atomic weapons, which Iran has denied.

For China, the world’s second-largest oil consumer, another month of rising imports could have jeopardised a last-minute waiver the United States granted it for six months from June 28, after Iran’s top oil buyer showed significant cuts in imports in the first months of the year on an unrelated pricing dispute with the Middle Eastern country.

“China’s crude imports from Iran recovered quickly in May and June,” said a Beijing-based oil analyst who declined to be identified because he was not authorised to speak to the media.

“The Chinese government might have had some pressure of not boosting imports too much because the United States had just given China a waiver.”

The strong June imports by state-owned firms had fuelled speculation China might go on a buying spree for more Iranian crude ahead of a July 1 European Union deadline barring insurance firms from covering Iranian crude shipments.

“The biggest guideline given is that overall imports from Iran should not deviate too much from the contract volume, although Sinopec may want to buy more when Iranian oil is cheap,” the analyst added.

China bought 1.93 million tonnes of Iran’s crude in July, equivalent to about 454,500 barrels per day, against 632,618 bpd in June, data from the General Administration of Customs showed.

China’s purchase represents about 41 percent of Iran’s estimated total exports of 1.1 million bpd in July.

India, which is reluctant to follow China’s move and take shipments on a delivered basis fromTehran, shipped in 201,860 barrels per day (bpd) from Iran in July compared with 346,600 bpd in June and about 338,900 bpd in July 2011, data made available to Reuters showed on Tuesday.

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