The Indian government may offer to cut imports of oil from Iran by a half in order to comply with American sanctions against Iran, Economic Times reports. The U.S. Treasury Department had already indicated waivers of sanctions would be available after America withdrew from the JCPOA, as outlined in Panjiva research of July 19, though these would be temporary in nature. It would also be a surprise to see an exemption given that India is also in the process of considering a preferential trade deal with Iran.

In the very near term the prospect of sanctions actually led Indian oil imports to prioritize shipments from Iran. Panjiva data shows imports in June from Iran represented 22.7% of the total after increasing 2.2x from January vs. a 6.9% decline for all imports. Halving imports from Iran, based on second quarter data, would require switching sourcing worth $7.2 billion on an annualized basis.

Chart segments Indian imports of crude oil by country of origin.   Source: Panjiva