Indian Bank to Stop Handling Iran Oil Payments

India’s oil imports from Iran will be affected from the end of August as the State Bank of India (SBI) has informed refiners it will not handle payments for crude from the Islamic Republic from November, the finance head of Indian Oil Corp said on Friday.

“(Oil) loading will be affected from end-August under the current mechanism unless a new payment route is established,” IOC’s A.K. Sharma told Reuters.

SBI did not immediately respond to requests for comment.

Local refiners use SBI, the country’s biggest bank, and Germany-based Europaeisch-Iranische Handelsbank AG (EIH) to pay in euros for purchase of Iranian oil.

India’s Reliance Industries Ltd, owner of the world’s biggest refining complex, plans to halt oil imports from Iran while Rosneft-promoted Nayara Energy has started cutting purchases from this month, sources said.

It comes following the US exit from the nuclear agreement Iran and the Group 5+1 (Russia, China, the US, Britain, France and Germany) reached in Vienna in 2015.

In a speech from the White House on May 8, US President Donald Trump announced the US withdrawal from the accord, known as the Joint Comprehensive Plan of Action (JCPOA).

Trump also said he would reinstate US nuclear sanctions on Iran and impose “the highest level” of economic bans on the Islamic Republic.

The new US sanctions will take six months to be imposed, but a number of European companies have already halted their businesses in Iran despite verbal pledges by their governments to protect them against any fallout.

(Source: Tasnim, under Creative Commons licence)

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