US Understands Our Need For Iranian Oil: India

India Monday reiterated its compulsion to depend on the Iranian oil to meet its increasing energy demands. 

India’s Oil and Gas Minister S. Jaipal Reddy told Reuters that the U.S. understood the country’s need for the Iranian oil imports. "The United States appreciates the larger needs of the country and it has also seen the efforts we have made to reduce our dependence on Iran imports to a considerable degree," he told Reuters at the World Energy Forum in Dubai.

"And while we respect the United Nations sanctions, we don't want to ignore the requests of other nations."

Despite the U.S. and the West’s economic sanctions on Iran over its nuclear project -- which Iran claims to be for a civilian purpose and the West terms it as a clandestine nuclear bomb project -- India has been depending on the Iranian oil.

India has good relations with Iran and both the countries have bilateral pacts on trade and economy. Even at the face of the opposition from the West, India has defended Iran’s right to have the civil nuclear project though it has expressed its opposition to Iran’s alleged move to build the nuclear arsenal.

However, bending to the U.S. pressure, India reduced the oil imports from Iran, and the U.S. reciprocated in June by granting a waiver to India on the sanctions against Iran on the ground that it had reduced its Iranian oil purchases.

India needs about 15 million tons of oil per year and it depends on imports to meet 80 percent of the demand. In order to diversify its energy dependence and seeking a cheaper alternative, Indian oil companies have been exploring shale gas exploration and imports from the U.S. in the recent years.

Earlier this month, Oil India Ltd and Indian Oil Corporation together bought a 30 percent stake in Houston-based Carrizo Oil & Gas’s Niobrara shale gas asset in Colorado for $85.2 million. Reliance industries and Gail also have stakes in the U.S.-based Marcellus’ shale play in Carrizo and in Eagle Ford Shale respectively.

The U.S. currently bans gas exports to countries like India that are not part of the Free Trade Agreement group. However, India expects that these sanctions would be waived in the future considering the high market demand in India.