India and Iran are set to revive high-level energy talks this week as Iranian Oil Minister Mohsen Paknejad is expected to meet officials from the Ministry of Petroleum and Natural Gas (MoPNG), raising fresh interest in the future of Iranian crude supplies to India.
The discussions come as New Delhi evaluates expanding imports from Iran after limited purchases resumed earlier this year following a gap of nearly seven years. However, before US sanctions disrupted trade, Iran was one of India's largest and most reliable crude suppliers.
Iran's share in India's crude basket steadily increased through the second half of the last decade, peaking at more than one-tenth of the country's total oil imports.
India imported around 11 million metric tonnes (MMT) of crude from Iran in 2015, accounting for roughly 6% of its total crude imports. Purchases increased to 14 MMT in 2016, taking Iran's share to 6.7%.
Imports surged sharply in 2017 to 27 MMT, when Iran supplied 12.6% of India's crude requirements—the highest share during the period. Although volumes moderated to 23 MMT in 2018, Iran still accounted for 10.4% of India's crude imports.
In 2019, imports stood at 24 MMT, representing 10.6% of India's crude basket. However, purchases came to an abrupt halt in May that year after the United States ended sanction waivers for countries importing Iranian oil.
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The impact was immediate. India's imports from Iran collapsed to just 2 MMT in 2020, reducing its share of the country's crude imports to less than 1%.
| Calendar Years | Volume (MMT) | % Of Total Imports |
|---|---|---|
| 2015 | 11 | 6 |
| 2016 | 14 | 6.7 |
| 2017 | 27 | 12.6 |
| 2018 | 23 | 10.4 |
| 2019 | 24 | 10.6 |
| 2020 | 2 | 0.9 |
Industry participants say Iranian crude had traditionally been attractive to Indian refiners because of its competitive pricing, favourable credit terms and suitability for processing at several domestic refineries.
According to sources in oil marketing companies, traders and analysts, the National Iranian Oil Company (NIOC) has once again reached out to Indian refiners and traders to explore future crude sales.
However, refiners remain cautious. Any significant increase in purchases will depend on greater clarity over US sanctions, along with the availability of payment mechanisms, shipping arrangements and insurance cover.
According to Kpler data, India imported around 73,000 barrels per day of Iranian crude in June, reflecting a gradual return of supplies after limited purchases resumed in April.
While the upcoming India-Iran talks could pave the way for deeper energy cooperation, industry experts believe a full-scale revival of Iranian crude imports is unlikely in the near term. Instead, future purchases are expected to depend on commercial viability, evolving geopolitical developments and greater certainty around the global sanctions regime.
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