Did an Iranian crude ship bound for India divert to China over ‘payment issues’? Centre fact checks report

The Union Ministry of Petroleum and Natural Gas on Saturday rubbished reports claiming that an Iranian ship headed for India had diverted to China due to alleged payment issues.

In a statement on X, the petroleum ministry called the claim “factually incorrect”, adding that companies have full flexibility to import oil from different sources.

“The news reports and social media posts of an Iranian crude cargo being diverted from Vadinar, India to China due to “payment issues” are factually incorrect. India imports crude oil from 40+ countries, with companies having full flexibility to source oil from different sources & geographies based on commercial considerations,” the petroleum ministry said in a statement on Saturday.

No payment hurdle: Govt

Further denying claims made in the media reports, the Centre said that there were no payment hurdles for Iranian crude imports to India.

“Amid Middle East supply disruptions, Indian refiners have secured their crude oil requirements, including from Iran; and there is no payment hurdle for Iranian crude imports, contrary to the rumours being circulated,” it said.

According to a Bloomberg report on early Saturday, the US-sanctioned vessel carrying Iranian crude oil was initially heading for India, where it would have been the first such shipment in nearly seven years.

The report said that the 2002-built Aframax named Ping Shun was signalling Dongying in China, as per ship-tracking firm Kpler.

Earlier this week the ship had indicated it would arrive at Vadinar on India’s west coast, but it has since taken a sharp turn to the south, the report claimed, adding that such destination signals were not final.

Later, PTI reported quoting Kpler analyst Sumit Ritolia that the shift in destination of Ping Shun appears to be payment-related. Amid the crude supply constraints, sellers have been tightening terms, moving away from the earlier 30-60 day credit window toward upfront or near-term settlement, the report said.

However, the petroleum ministry stressed that the claims on “vessel diversion ignore how oil trade works.”

“Bills of Lading often carry indicative discharge ports destinations and on-sea cargoes can change destinations mid-voyage based on trade optimisation and operational flexibility,” it said.

Ping Shun is estimated to be carrying about 600,000 barrels of oil that was loaded from Kharg Island around 4 March. Its declared ETA to Vadinar was 4 April, according to Kpler.

India's crude requirement secure

The government further reiterated that the crude requirement of India was secure in the coming months despite the supply constrains due to the blockade of the Strait of Hormuz amid the Middle East tensions.

“It is reiterated that India’s crude oil requirements remain fully secured for the coming months,” the petroleum ministry said.

“On LPG too, some claims being made are incorrect as LPG vessel Sea Bird carrying around 44 TMT Iranian LPG berthed at Mangalore, India on April 2 and is currently discharging,” it added.

Earlier today, India-flagged large gas carrier Green Sanvi safely transited the Strait of Hormuz on Friday night, carrying approximately 46,650 metric tonnes of Liquefied Petroleum Gas (LPG) cargo, official sources said.

The Centre has been in talks with Iranian authorities to allow Indian vessels to pass through the Strait of Hormuz amid a maritime blockade due to the ongoing Middle East conflict.