India won’t scale down petroleum imports from Iran

What do you guys think...Drone Strikes?
-------------------------------
India, which imports 12 per cent of its oil from Iran, will not scale down its petroleum imports from Tehran despite US and European sanctions against the Islamic republic, Finance Minister Pranab Mukherjee has said.

“It is not possible for India to take any decision to reduce the imports from Iran drastically, because among the countries which can provide the requirement of the emerging economies, Iran is an important country amongst them,” Mr. Mukherjee told reporters.

Speaking at the end of a two-day visit aimed at wooing U.S. investment, Mr. Mukherjee, on Sunday, said “Some other countries, Saudi Arabia, Nigeria, the other Gulf countries they also contribute but Iran contributes substantially.”

“We (India) imports 110 million tonnes of crude per year. We will not decrease imports from Iran. Iran is an important country for India despite U.S. and European sanctions on Iran,” the finance minister said.

India, the world’s fourth-largest oil consumer, is Iran’s second-biggest oil client after China.

http://www.thehindu.com/news/national/article2844349.ece

 

No, they will get a finger wagging like Russia did when it invaded Afghanistan, and we created Osama.

 

I'm wondering how many other countries will now balk at the sanctions.

 

Everyone not in the EU, most likely.

 

If Iran can physically transport the crude outside it's own borders (via pipeline or ship), then the sanctions won't have much effect. Crude is a global commodity, therefore sanctions have to be all or nothing. Europe and the US will boycott, while China and India will pick up excess Iranian crude at a discount. Realistically, the West would have to blockade Iran if they want to disrupt exports. If they go that route, well, that would be fucked up.

 

If you think about it, NATO is basically asking emerging economies (BRIC) to eat a 50% hike on energy costs.

The West wants a global embargo against Iran. That takes, what? 5% of global crude production out of supply? That would increase oil prices by at least 50%. Perhaps more. So instead of 100$ oil. China, India, Brazil would have to accept 150$ oil. Economically, socially, and politically, this is untenable, to them.

 

The italicized part is what they're after, make them feel pain. Iran is a supply region, and depends entirely on the price of oil to fund itself. It was expected they'd sell to Asia, but given the limited number of buyers they'd be forced to offer a discount.
Remember that any shortage that could affect the overall global price can (and will) be made up by a combination of Libya coming back on line and Saudi Arabia just pumping out more as needed.
A blockade is low-probability as that is technically an act of war.

 

20% though the speculators think the price of crude could double.

 

I think part of this is an extension of the Arab Spring. Two birds with one stone. Pressure from above, pressure from below. The pressure from above is US military. Pressure from below, are domestic riots/civil insurrection spurred by (even) higher crude costs, against middle eastern Governments the US wants deposed.

Also, if OM77 is right about Iranian oil production accounting for 20% of global output, how can the Saudis and Libya make up that shortfall. That's a tonne.

 

If it's that much, than ya, I agree.