New Delhi: A shipment of Iranian crude oil may be headed to India for the first time in nearly five years, with vessel tracking data indicating a cargo bound for Gujarat’s Vadinar port following a temporary easing of US sanctions. Indian refiners have begun exploring purchases of Iranian crude already at sea after Washington allowed a limited window for such transactions amid heightened geopolitical tensions.
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Market intelligence firm Kpler flagged the development as a potential turning point in bilateral oil trade. "The Indo-Iranian oil trade has flickered back to life. Following the US administration's decision to grant a 30-day window for Iranian oil "on the water" due to regional conflict, the vessel Ping Shun is now en route to Vadinar (in Gujarat) with 600,000 barrels of crude. This is the first such delivery since May 2019 and comes at a critical time for Indian refiners facing tightening inventories," said Sumit Ritolia, Lead Research Analyst, Refining and Modelling at Kpler.
He added that, "The Aframax Ping Shun (IMO 9231901) loaded with Iranian crude oil from Kharg Island in early March has emerged as the first vessel observed signalling a destination of Vadinar, India since May 2019, following sanction reimposition on Iranian oil by the first Trump administration."
Further detailing the shipment, he said, "The tanker is estimated to have loaded approximately 600 kb (600,000 barrels) from Kharg Island around 4 March, with a declared ETA to Vadinar on 4 April."
While the end buyer has not been disclosed, Vadinar hosts a 20 million tonne per annum refinery operated by Nayara Energy, backed by Russia’s Rosneft. The port also supplies crude to inland refineries such as Bharat Petroleum Corporation Ltd’s Bina unit.
The oil ministry has maintained that any decision to resume Iranian imports will depend on techno-commercial considerations.
India was once a significant importer of Iranian crude, drawn by favourable pricing and compatibility with refinery configurations. Imports halted in May 2019 after the US sanctions tightened. At its peak, Iranian oil accounted for 11.5 percent of India’s crude imports. Volumes stood at about 518,000 barrels per day in 2018, easing to 268,000 bpd in early 2019 during a temporary sanctions waiver period before dropping to zero.
Indian refiners primarily sourced Iran Light and Iran Heavy grades during that period.
The current development follows a US decision earlier this month to permit purchases of Iranian crude already at sea for a 30-day period, aimed at easing global oil prices amid ongoing conflict in West Asia. The window is set to close on April 19.
An estimated 95 million barrels of Iranian oil is currently floating in storage, with about 51 million barrels potentially suitable for India, while the rest is more aligned with demand in China and Southeast Asia.
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However, payment remains a key constraint. Iran continues to be excluded from the SWIFT global banking system, complicating transaction mechanisms. Earlier trade routes, such as euro payments routed through Turkish banks, are no longer available.
Iran was first cut off from SWIFT in 2012 following European sanctions over its nuclear programme, with further restrictions imposed in 2018 after the US reinstated sanctions, severely limiting its ability to receive payments and conduct global trade.
