The Wall Street Journal, New Delhi, 6 Jan 2012 – India may face problems in making payments to Iran for crude supplies because of recent moves by the U.S. to curb Tehran’s nuclear program, a senior Indian official said Friday.
He didn’t say what the problems might be, but he added that ‘we don’t see any disruption in supply unless the Strait of Hormuz is closed.’
Iran, the world’s fourth-largest oil producer, has threatened to block oil deliveries through the Strait of Hormuz if global powers impose sanctions on the country’s oil industry over its nuclear activities. The U.S. Energy Information Administration estimates that the strait carries about 20% of all oil traded worldwide.
India gets about three-quarters of its crude needs through imports, and Iran is its second-largest supplier after Saudi Arabia.
U.S. President Barack Obama signed a bill into law late last month empowering U.S. authorities to impose penalties on foreign banks dealing with the Central Bank of Iran to settle oil import payments.
The European Union has also agreed in principle to ban imports of Iranian crude oil to the E.U.