Iran is set to lose one of its biggest buyers as India announced Friday  that its insurers will no longer cover refineries importing crude oil from the country.
This comes as a major hit to Iran’s already shaky economy  as India spends about $1 billion each month on oil from Iran and is the nation’s second-largest buyer, Reuters reports.
Indian importers have halted shipments as insurance companies are refusing to cover the refineries that process imported crude oil due to Western-imposed sanctions on Iran  , reported the Washington Times on Friday.
“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,” P.P. Upadhya, managing director of India’s biggest crude buyer, Mangalore Refinery and Petrochemicals Ltd., told 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, shared these sentiments.
“Iran imports will be stopped soon,” one HPCL source told Reuters. “As far as insurance is concerned, we are all sailing in the same boat.”
The news comes as the EU prepares to impose further sanctions on Iran due to the country’s human rights violations.