However, according to Alice G. Wells, principal deputy assistant secretary of state for South and Central Asia, the USA has not taken any decision on sanctioning India for importing oil from Iran and investing in the Chabahar port. India would lift 9 million barrels of Iranian oil in November, equivalent to about 300,0000 barrels per day (bpd), compared to an average of about 658,000 bpd from April to August, according to data available with Reuters.
Oil dropped below $83 a barrel on Monday, pressured by expectations that some Iranian oil exports will keep flowing after the USA reimposes sanctions, easing a strain on supplies.
USA president Donald Trump is reported to be "actively considering waivers" on sanctions on Iranian oil imports for some countries ahead of the November deadline.
"Likely, India and Iran will agree to use Rupee payments instead of U.S. dollar payments, something already tried between 2013 and 2015, with Iran then using Rupees to import food, medicines and other commodities from India", said Leszczynski.
Brent crude, the global benchmark, was down 1.32% to $83.05 a barrel on London's Intercontinental Exchange early on Monday.
Furthermore, Leszczynski says that if India were to stop or significantly reduce imports from Iran, it would complicate the strategic relationship it is trying to build between the two countries.
Delhi is hopeful that Saudi Arabia and other members of the Organization of Petroleum Exporting Countries will heed United States calls for production to be boosted by one million barrels per day, as promised in June, which might help bring benchmark prices down.
Oil also dropped as investors focused on rising output from other producers, such as top exporter Saudi Arabia, to compensate for lower Iranian supplies.
"Iran's oil can not be replaced by Saudi Arabia nor any other country", Zanganeh was quoted as saying on his ministry's website.
JP Morgan had expected demand growth to moderate this year, but so far demand has been "relatively robust", Scott Darling, regional head of oil and gas research at JP Morgan Chase, told Bloomberg on Monday. To this, taxes at the central and state levels are added, besides dealers' commission, to arrive at the retail price.
On the last week's excise duty and fuel price cut, the minister said these prices will not be deregulated.
"In effect, the government has asked the OMCs to sell petrol and diesel at subsidized prices, for which they will not be reimbursed", the report said. He added that state-run oil companies must also look at taking measures to ease the burden of consumers.