Iraq has overtaken Saudi Arabia as India's largest oil supplier

Reuters/Rupak De Chowdhuri

Iraq has now overtaken Saudi Arabia in crude-oil exports to India, shipping some 960,700 barrels per day (bpd) to India in April, against Saudi Arabia's 787,700 bpd in exports to the Asian nation, turning the tables on the Saudis and placing Iraq at the top of the chain of OPEC members grappling for market share in this growing economy.

Iraq's oil exports to India rose by 41% in April and by 79% compared to a year ago. At the same time, Saudi Arabia's exports to India were down 14% in April over the same time last year.

Overall, Iraq accounted for 22% of India's crude-oil imports in April, while last year it accounted for 15%. Saudi Arabia's India crude-oil market share dropped to 18%, down from 25% last year.

India has seen a new surge in crude-oil imports overall. Since March, Indian crude imports are up 6% on the month, and up 9.9% in the first four months of this year. For the first four months of 2015, imports fell 0.6% from a year ago, largely because of outages at refineries.

Demand for crude oil in India has risen this year because of a lack maintenance processes at Indian refineries, which have been postponed and would normally have taken refineries offline for a spell.

Analysts are not surprised by this latest market-share change.

"Iraqi oil is much more beneficial than Saudi because they are better priced. There is a significant difference in prices," said A. K. Sharma, head of finance at Indian Oil Corp., as reported by Reuters.

But Iran is also zeroing in on Indian market share, with a fair amount of success, and could challenge Iraq and Saudi Arabia here. The country accounted for about 9% of overall purchases in April compared to about 7.2% a year ago.

Over the first four months of 2016, Iranian oil accounted for about 7.4% of Indian imports from about 4% a year ago, becoming the fifth-largest oil supplier to India compared with its eighth-place position a year ago.

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