India on Tuesday blamed the proposed US sanctions on Iran for the spike in global crude oil prices and not supply constraints. The US embargo on supplies from the Islamic nation is set to take effect from early November.

“There is no issue of availability of crude oil today. But due to geopolitical uncertainty in different parts of the world, there is a sentimental issue. That is the primary challenge,” oil minister Dharmendra Pradhan told reporters on the sidelines of an industry event.

“From day one, we are confident that there is no problem in sourcing of crude. There is plenty available in different parts of the world. The sentiment is that if a big oil producer goes out of the market, it may hamper supplies, impact prices and lead to volatility. The issue is not shortfall. The issue is sentiment,” he said.

Oil prices hit a four-year high of $86.74 a barrel earlier this month.

IHS Markit vice-chairman Daniel Yergin, who was present along with Pradhan, said oil markets had a sentiment problem and not a supply issue.

“Oil market is physically balanced but emotionally unbalanced because of uncertainty, because of geopolitical issues. That is what is impacting the price.”

Refusing to say if India had sought a waiver of sanctions from the US on purchasing crude oil from Iran, Pradhan said he had articulated the country’s position on importing oil from the Persian Gulf nation earlier and “there was nothing new to repeat”.

Last week Pradhan had said two state-owned oil refiners — Indian Oil and MRPL — had booked 1.25 million tonnes (mt) of crude oil from Iran for November supply.