Iraq overtook Saudi Arabia as the top crude exporter to India in April for the first time since December, according to data compiled by Reuters, as the two biggest OPEC producers fight for market share in Asia's fastest growing oil market.
Iraq overtook Saudi Arabia as the top crude exporter to India in April for the first time since December, according to data compiled by Reuters, as the two biggest OPEC producers fight for market share in Asia’s fastest growing oil market.
Saudi Arabia also lost its top spot in China, Asia’s biggest oil consumer, last month when Russia overtook the world’s biggest crude exporter due to strong purchases by Chinese independent refineries.
Overall, April oil imports by India rose 6 percent from March and are up 9.9 percent in the first four months from a year ago. For the first four months of 2015, imports fell 0.6 percent from a year ago because of refinery outages.
Iraqi oil exports to India were 960,700 barrels per day (bpd) in April, a 41 percent jump from March and 79 percent higher than a year ago, data obtained by Reuters and compiled by Thomson Reuters Oil Analytics showed.
India imported about 787,700 bpd of oil from Saudi Arabia last month, about 14 percent lower than a year ago, the data showed.
Iraq accounted for 22 percent of April Indian imports, up from about 15 percent a year ago, while Saudi Arabia’s share dropped to 18 percent from about 25 percent a year ago.
“Iraqi oil is much more beneficial than Saudi because they are better priced. There is a significance difference in prices,” said A. K. Sharma, head of finance at Indian Oil Corp..
Iraq has consistently maintained their official selling prices (OSP) below Saudi Arabia. In April, Iraq set the OSP for its flagship Basrah Light crude at a discount of 2.60 a barrel to Middle East benchmarks, 20 cents under the OSP for comparable crude grade Arab Medium.
Overall, Indian crude demand rose in 2016 as refiners normally avoid maintenance shutdown in the first quarter to meet annual crude processing target for the fiscal year.
Also, Indian Oil Corp, the country’s biggest refiner, boosted imports after commissioning the 300,000-bpd Paradip refinery.
Iran is also raising its share in Indian imports. The country accounted for about 9 percent of overall purchases in April compared to about 7.2 percent a year ago.
Overall in January to April, Iranian oil accounted for about 7.4 percent of Indian imports from about 4 percent a year ago, becoming fifth-largest oil supplier to India compared with the eighth position a year ago.
On the losing side, Latin American suppliers exported 8.2 percent less crude to India during January to April. The region’s share in Indian imports declined to about 16 percent from about 19 percent a year ago as its oil has become uncompetitive in the ongoing price war.