After the latest round of U.S. sanctions was announced, HPCL was the first Indian refiner to halt purchases from Iran after its insurer backed out.
"Oil prices sold off sharply. on news that the US administration would grant waivers for oil imports from Iran", Goldman Sachs analysts said in a note to clients.
On the one hand, it's unclear how much Iranian oil will really be removed from the market, considering that Iran has already started to switch off transponders on board of some of its cargoes, although ship-tracking data on the tankers that can be tracked shows that Iranian oil exports are falling, but not as steeply as the market and analysts were expecting just a month or two ago.
"It's a virtual certainty that Western banks are not going to violate the escrow restrictions", said Mark Dubowitz, the chief executive of the Washington-based Foundation for Defense of Democracies who has advised Pompeo.
But the move has backfired on U.S. President Donald Trump as it led to a steep rally in oil prices, including the cost of gasoline, ahead of U.S. mid-term elections. "On Monday, in front of us, all of the sanctions that had been relieved by the Obama administration will return".
Iran says the United States is seeking to wage an extensive "psychological war" against Tehran by imposing a fresh round of sanctions, stressing that the Islamic Republic has no concerns over such USA bids.
"They continue to produce better and better missiles that can threaten the Middle East and eventually potentially Europe as well".
Pompeo and Mnuchin both said the sanctions will have exceptions for humanitarian purchases. The reduction in Iranian crude would likely bring up global prices.
Iran has accused Mr Trump of waging "psychological warfare".
"But the people should know with certainty that the government has no fear of American threats".
"If you cross us, our allies or our partners, if you harm our citizens, if you continue to lie, cheat and deceive, there will be hell to pay".
He added: "In the past few months our people have faced hard times and it's possible that the next few months will be hard".
After President Donald Trump made a decision to pull the United States out of the Joint Comprehensive Plan of Action (JCPOA), the multinational deal under which Iran agreed to suspend its nuclear program, his administration announced that it would reinstate economic sanctions against Iran, including those aimed at its oil exports.
The Schork Report Publisher Stephen Schork on the outlook for oil.
Iran is India's third-largest oil supplier after Iraq and Saudi Arabia. These channels would get blocked from November.
Iran said on Friday the report on waivers showed that the market needed the country's crude.