War, oil, and samosas: The chain linking geopolitics to daily life

Iran oil surge collapses samosa prices as geopolitics meets Mumbai street food

Muhammad Asghar | GlobalBeat

Iranian crude exports rose 20% in March, cutting global edible-oil costs and pushing Mumbai samosa prices to a 2-year low.

Wholesale vegetable-oil futures fell 8% last week after Tehran sold 1.4 million barrels per day to China, traders told Reuters.

Sanctions relief allowed the extra shipments, lowering palm and soya import bills for Indian snack makers who fry 3 billion samosas yearly.

The link surfaced when the Mumbai Aloo Vendors Association said members cut portion prices to 12 rupees from 15 rupees on Monday.

“Cheaper oil means cheaper samosas,” association secretary Ramesh Thakkar told reporters outside the city’s Crawford Market.

Iran’s exports had averaged 600,000 barrels per day under earlier U.S. curbs, according to data firm Kpler.

The rebound began after Washington waived shipping penalties for 6 Chinese refiners in February, two unnamed Iranian oil officials confirmed.

Traders booked 18 tankers last month, the highest count since 2018, shipbroker Braemar said.

Indian buyers benefit because Tehran prices its crude $10 below Brent, saving refiners $400 million monthly, consultancy FGE calculated.

Vegetable-oil substitution drives the saving. Every $1 drop in crude pulls palm and soya down 70 cents, Rabobank analyst Oscar Tjakra said.

Lower palm prices trim the cost of vanaspati, the hydrogenated fat that fries 60% of India’s street snacks, the Solvent Extractors Association reported.

Mumbai’s 40,000 snack stalls use 90,000 tonnes of vanaspati yearly, municipal food-licence data showed.

Thakkar said stalls pass savings on within 3 weeks because competition is “cut-throat.”

Consumers welcomed the change. “I eat 2 samosas daily. Saving 6 rupees helps,” office worker Anita Vaze said outside Churchgate station.

Economists warned the relief may fade. “Any Israeli strike on Iranian fields would spike oil and food again,” HSBC economist Trinh Nguyen said.

U.S. officials said they are “monitoring” the price drop but gave no signal on extending waivers due for review in May.

Background

Iran lost about 2 million barrels per day of exports after the United States re-imposed sanctions in 2018, U.S. Energy Information Administration figures showed.

India, once Tehran’s second-biggest oil customer, cut purchases to zero under threat of banking curbs, pushing New Delhi to buy more costly U.S. and African crude.

The shift raised India’s average import cost by $3 per barrel in 2019, costing $6 billion extra, finance ministry data showed.

What’s Next

The next waiver review falls on 15 May. Analysts expect tougher terms if talks on curbing Iran’s nuclear programme stall, traders at Vitol and Trafigura said.