Hormuz blocked, but India may get first delivery of Iranian crude oil after 7 years

The tanker is expected to be carrying around 600,000 barrels of Iranian crude that was loaded on the tanker around March 4 at Iran’s main oil facility of Kharg Island, ship tracking data shows.

An oil tanker carrying Iranian crude is signaling India as its destination, marking the first potential delivery of Tehran’s crude to India since May 2019. Amid the raging West Asia war, the US on March 21 suspended for a month the sanctions on Iranian crude already loaded on tankers in a bid to allow as many barrels of oil as possible to flow into the international market to improve the global oil supply situation and curb spiraling crude oil prices. The waiver from Washington was similar to the one issued for Russian oil earlier in March.

According to vessel tracking data from commodity market analytics form Kpler, Eswatini-flagged tanker Ping Shun is signaling Gujarat’s Vadinar port as its destination. The tanker is expected to be carrying around 600,000 barrels of Iranian crude that was loaded on the tanker around March 4 at Iran’s main oil facility of Kharg Island, ship tracking data shows. It is expected to arrive at Vadinar on April 4, according to the vessel’s declared estimated time of arrival. It could not be immediately ascertained which Indian refiner would be using this oil.

While industry experts appear confident that the tanker is indeed headed to India, a change in its destination cannot be completely ruled out at this stage. Dark fleet tankers involved in sanctioned oil trade use frequent destination changes as part of their effort to avoid detection and hide their actual paths. Currently, given the sanctions waiver for Iranian oil and vessels transporting it, such tactics are not really required.

“The Indo-Iranian oil trade has flickered back to life. Following the US administration’s decision to grant a 30-day window for Iranian oil ‘on the water’ due to regional conflict, the vessel Ping Shun is now en route to Vadinar with 600,000 barrels of crude. This is the first such delivery since May 2019 and comes at a critical time for Indian refiners facing tightening inventories,” said Sumit Ritolia, lead research analyst, refining & modeling, at Kpler.