Iraq takes Saudi crown to become oil king of key Asian market www.rt.com
As competition among oil producers for major Asian markets intensifies, Iraq has become India’s top crude supplier for a third month in May, surpassing Saudi Arabia.
Shipping data compiled by Bloomberg showed, Iraq supplied 1 million barrels a day and those supplies accounted for 23 percent of India’s purchases last month, up from an average 19 percent in the previous four months. Saudi Arabia’s share fell to 17 percent.
India’s total crude imports in May stood at 4.35 million barrels a day. Its $2-trillion economy imports more than 80 percent of crude requirements and the International Energy Agency expects it to be the fastest-growing consumer through 2040.
“Saudis used to be the king when it comes to crude supply, but now it’s becoming a prince,” said R. Ramachandran, the head of refineries at Bharat Petroleum, India’s second-biggest state-run refiner.
“Preference for Iraqi crude will continue as Indian refiners continue with refinery upgrades,” he told Bloomberg.
Iraq has been India’s second biggest supplier of oil for years. However, the Gulf nation’s poor port infrastructure resulted in delays and inconsistencies in shipments, making Iraqi crude less preferred than that of Saudi Arabia. Recently, Iraq has improved the infrastructure to ensure stable supplies.
“Iraqi crude is getting attractive and it suits our refineries very well,” said Mukesh Kumar Surana, chairman of Hindustan Petroleum. “Iraq has come out of the supply uncertainties and the pricing is very competitive.”
Hindustan Petroleum buys about 4 million tons of Iraqi oil annually on a term basis, which matches the volume it gets from the Saudis.
According to India’s Finance Director Arun Kumar Sharma, the nation’s biggest processor Indian Oil Corporation will boost Iraqi imports to about 18 million tons this year from 15.6 million in 2016. Saudi purchases are expected to remain steady at 5.6 million tons.
Published Date:2017-06-15