India's oil minister on Saturday expressed concern about the rise oil prices but said it was too early to predict the impact of US sanctions on his country's imports of Iranian oil after Washington withdrew from the Iran nuclear deal.
"This kind of geopolitical (tension) affects both consuming and producing countries. We have to live with the reality of the present geopolitics," Minister Dharmendra Pradhan told Reuters during a visit to the United Arab Emirates.
US President Donald Trump on Tuesday reneged on an international nuclear accord with Iran and announced renewed sanctions against the OPEC member. The original agreement had lifted sanctions for Tehran limiting its nuclear program.
Crude prices remained just below multi-year highs, with Brent on track for a weekly 2.8 percent gain and US crude a 1.2 percent weekly rise. Brent crude settled down 35 cents at $77.12 a barrel on Friday.
Pradhan said he was "a little bit concerned" about the impact of the current rise in oil prices on consuming countries but that he did not think oil supply would be an issue.
"Let's see how things are moving. It's too early to predict in one way. We are watching very carefully," he said.
Iran is the third-largest oil producer in the Organisation of the Petroleum Exporting Countries (OPEC). Iran ramped up supplies after lifting the sanctions in 2016, producing 3.81 million barrels per day (bpd) in March 2018.
Analysts now expect Iran's supplies to fall by between 200,000 bpd and 1 million bpd, depending on how many other countries fall in line with Washington.
During the last round of sanctions, India enjoyed waivers allowing limited Iranian oil imports paid for in rupees instead of US dollars.
When sanctions were loosened against Tehran, India increased imports from Iran to almost 900,000 bpd in late 2016, but intake has fallen back to around 500,000 bpd this year.