Iran is a potential supplier of oil and it is expanding its supply day by day. The process of oil mining is tedious but Iran is always trying to update the process of mining through different techniques and by deploying more skilled laborers, workers, and engineers. In 2017-18 it was seen, that Iran was the third-largest supplier of oil after Iraq and Saudi Arabia, meeting about 10 percent of total needs. Iranian oil is a lucrative buy for every potential refiner as the Persian Gulf nation provides 60 days of credit on making a purchase, but terms are not available from suppliers of substitute crudes Saudi Arabia, Kuwait, Iraq, Nigeria, and the U.S. Since sanctioned are eased, now India will have more opportunity and demand to buy crude oil from Iran. It will help to do betterment in the import process and we will have more oil stock. Now there will be a drastic change in Import basket as said by a senior government official. India recently stopped importing oil from Iran in mid-2019 following sanctions on the Persian Gulf nation by the administration run of Trump.
The Iran nuclear deal is planned to get revived and for this meeting, the U.S. and other world powers are meeting in Vienna. Once the sanctions are up we can look to resume imports of oil from Iran said the official who doesn’t want to get identified. We already have a model for commercial terms and with speed, it is possible to enter into contracts the moment Iran is cleared for exporting oil, as said by the officials.
Iranian oil coming into the market will not only cool prices but would also help India diversify its import basket. In 2020-21, Iraq was India's biggest oil supplier, followed by Saudi Arabia and the UAE. Nigeria was the fourth-largest supplier and the U.S. was the fifth. We have been advocating for oil producers to pump in more oil by easing output caps, as the official said. Rising oil prices are a threat to the fragile economic recovery around the globe including India. India, he said, did not advocate for such output increases when prices were within a certain reasonable limit. We voiced our concerns when the oil crossed USD 63-64 on a sustained basis. We want prices that are reasonable for producers and affordable for consumers.