India-Iran oil payment dispute resolved

India and Iran has resolved the seven-month old oil trade dispute before ending deadline of interrupting the oil transportation to India from Iran. Iran that exports India 400,000 barrels per day (bpd) - 12% of its daily requirement of crude oil had threatened India that it would stop the export of crude oil by 01^st August 2011, if India does not clear all its oil dues to Iran.

Indian refineries are in great debt of whopping US$5-bn to Iran due to not being able to pay the price of crude oil since after the Reserve Bank of India in December last year had debarred the earlier payment system of oil to Iran. The apex bank had stated that payments to Iran could not be settled using a clearing system of regional central banks.

Now, according to sources, India will repay the debt in Euro and other foreign currencies through Union Bank of India and Turkey's Halkbank in Istanbul to settle the payments to National Iranian Oil Company (NIOC).

The Director of International Affairs, NIOC Mohsen Qamsari informed the media that both sides had agreed to clear the debt promptly in the coming days. 'The part payment will be cleared on Monday while rest of the payment will be settled gradually' informed Qamsari to the media.

Indian Oil importer Mangalore Refinary Petrochemical Ltd. (MRPL) is the biggest oil and petroleum importer from Iran while Essar Oil, Hindustan Petrochemical Ltd. (HPCL) and Indian Oil Corporation (IOC) are others.