Iran threatens to halt crude oil supplies to India if not paid: report

The unnamed official told Fars that no crude export permission to Indian refineries has been issued for August by the Iranian Oil Ministry.

Therefore, it is more likely that, if payment problem is not solved, Iran will not export any crude to India, said the official, adding that Indian refineries should then look for other sources and other countries to meet their daily crude needs.

Earlier in the month, Iran threatened to halt crude oil supplies to India from August if New Delhi fails to pay nine billion U.S. dollars for oil imports from Iran, which is now seven months in arrears.

According to the local reports, India has been supplied some 400,000 barrels per day of crude oil on credit by Iran since late December last year.

Under the U.S. pressure in December last year, the Reserve Bank of India scrapped a long-standing system to pay for import from Iran using a clearing house system run by regional central banks and since then the Indian government has been trying to find an alternative mechanism to the scrapped system.

India and Iran's other crude customers are under the U.S. pressure to reduce oil transactions with Iran and under the pressures the current payment mechanisms for clearing the debts have faced serious problems.

Iran is the second largest crude supplier to India by meeting the 12 percent of its annual oil needs after Saudi Arabia.