India to Make Iranian Oil Payments Through Turkey

Posted July 29th, 2011 at 12:25 pm (UTC-5)
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India says it plans to pay Iran billions of dollars in unpaid crude oil purchases through Turkey.

Indian Oil Minister S. Jaipal Reddy did not elaborate on the methods the government would use to route payments to Iran through Turkey during comments to reporters in New Delhi Friday.

Unnamed sources say India’s largest buyer of Iranian crude, Mangalore Refinery and Petrochemicals Limited, has already made a payment to Iran through Turkey’s Halkbank.

Iran’s central bank says India owes it $5 billion for oil deliveries in recent months. India has suspended payments for Iranian crude since December, in response to U.S. sanctions on banks doing business with Iran.

Reddy said last week that the Indian government is making alternative arrangements in case Iran cut off oil supplies.

Indian media has reported that Saudi Arabia has agreed to sell an extra three million barrels of crude oil to India to offset a possible supply cut.

Energy-hungry India gets more than 400,000 barrels of crude oil a day from Iran, roughly 12 percent of the South Asian country’s oil imports.

Washington has imposed financial sanctions on Iran for pursuing nuclear activities that Western powers suspect are aimed at developing nuclear weapons, a charge Tehran denies.