Shares of Gautam Adani’s conglomerate were in focus on June 3, after a news report by Wall Street Journal said US prosecutors were investigating the group for a possible involvement in buying liquefied petroleum gas (LPG) from sanction-hit Iran.
Refuting the allegations, the Adani Group has denied any ‘deliberate engagement’ in evading US sanctions on Iran, and called the report an ‘intentional act to injure the reputation and interests’ of the group.
Moneycontrol takes a closer look at the allegations against the Adani Group and energy ties of India, which was a huge market for Iranian oil until 2018, with Tehran.
Why has Adani Group Come Under Fire?
According to a Wall Street Journal report on June 2, the US is investigating if billionaire Gautam Adani’s companies imported Iranian liquified petroleum gas (LPG) into India through its Mundra port in Gujarat, in violation of sanctions on Iran.
The tankers travelling between Mundra port and the Persian Gulf exhibited traits common to ships evading sanctions, the WSJ report said, adding that the US Justice Department is reviewing the activities of several LPG tankers used to ship cargoes to Adani Enterprises.
The Adani Group, in a statement on June 2 called the report ‘baseless and mischievous’. The company denied any deliberate engagement in sanctions evasion or trade involving Iranian-origin LPG, adding that it was not aware of any investigation by US authorities on this matter.
On June 3, shares of Adani Group including Adani Enterprises, Adani Ports, Adani Total Gas, Adani Power fell between 1 percent to 2.5 percent. Read More
What are the US Sanctions Against Iran?
US President Trump had in 2018 - during his first term - withdrawn support from the Joint Comprehensive Plan of Action (JCPOA), also known as the Iran nuclear deal. The US withdrawal meant re-imposition of sanctions on exports of Iranian crude oil and petroleum products, crucial for economy of Tehran.
In 2015, several world powers including the US, under the Presidency of Barack Obama, had signed a nuclear deal with Tehran which lifted most sanctions in exchange for Iran limiting its nuclear programme.
Under the agreement, Iran agreed to dismantle much of its nuclear programme and open its nuclear facilities to more extensive international inspections in exchange for relief from sanctions necessary for revival of its economy.
However, Trump found the nuclear deal brokered by Obama ‘one-sided’ and claimed that it did not limit Tehran’s nuclear activity. He withdrew support from the nuclear deal in 2018, after being elected as the US President.
Now, during his second term, Trump is trying to negotiate a fresh nuclear deal with Iran.
Why Have Indian Entities Come Under US Scrutiny?
In 2025, several Indian entities faced US scrutiny for failing to comply with sanctions against Tehran and involvement in shipping Iranian oil and petroleum products.
On April 11, The US sanctioned a United Arab Emirates-based Indian national and two India-based entities operating as part of Iran's ‘shadow fleet’ and involved in shipping Iranian oil.
In February this year, the US sanctioned four Indian companies for their alleged involvement in the trade and transportation of Iranian crude oil and petroleum products. The US had sanctioned more than 30 companies, vessels, and individuals worldwide at the time, as part of its intensified efforts aimed at reducing Iran’s oil exports to zero. The US Department of the Treasury's Office of Foreign Assets Control (OFAC) had said that sanctioned vessels were involved in shipping tens of millions of barrels of crude oil.
How Have Been India’s Energy Ties with Iran?
Prior to the US sanctions re-imposed by the Trump administration, Iran was the third-largest crude oil supplier to India, till 2018-19.
According to an official statement by Dharmendra Pradhan in 2018, the then Petroleum and Natural Gas Minister, New Delhi bought 5.67 million tonnes or about 457,000 barrel per day (bpd) of oil from Iran in the first three months of 2018-19, following steep discounts on offer.
After the fresh sanctions slapped by Trump, Indian oil refiners curbed oil purchases from Tehran, and India currently does not source crude oil from Iran.
Current Petroleum Minister Hardeep Singh Puri had maintained a strong stance of not buying energy from any country under sanctions including nations such as Iran and Venezuela. However, India is increasingly looking at diversifying oil sources to secure energy availability, New Delhi has said it would be open to buying crude from any country, if sanctions on them are lifted. Read More
According to a Reuters report published in 2021, Indian state-run oil marketing companies (OMCs) were interested in buying Iranian oil if sanctions on the country were lifted as former US President Joe Biden was trying to revive the nuclear pact with Tehran. Indian refiners including Indian Oil Corporation Limited (IOCL), Bharat Petroleum Corporation Limited (BPCL) and Hindustan Petroleum Corporation Limited (HPCL) have refineries suited to process Iranian oil.
India is one of the largest crude oil importers in the world and is reliant on imports for around 90 percent of its crude oil requirements. Currently, India imports crude oil primarily from Russia, Iraq, Saudi Arabia, UAE and the US.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
