India halted the shipments because insurance companies aren’t covering the refineries that process the oil because of sanctions from the West, Reuters reports. That’s a major hit to Iran; India spends about $1 billion each month on oil from Iran and is the nation’s second-largest buyer, Reuters reports.
“If cover is not available, then all Indian refiners will have to halt imports from Iran or else they will have to take a huge risk,” said P.P. Upadhya, managing director of India’s biggest crude buyer, Mangalore Refinery and Petrochemicals Ltd., to Reuters. “Insurance companies said if I buy Iranian crude, my refinery’s insurance cover will be canceled.
Iran’s third-largest Indian crude buyer, Hindustran Petroleum Corp, said similarly.