It has replaced Iran as the second largest exporter of crude oil to India
With India looking for new partners and hubs to compensate the fall in oil imports from Iran, the Iraqi Government has offered to increase exports of crude oil to India.
This comes ahead of the proposed visit of Petroleum and Natural Gas Minister Veerappa Moily to Baghdad in June for the 17 session of the India-Iraq Joint Commission for Economic and Technical Co-operation.
In a letter to Mr. Moily last week, the Embassy of Iraq in New Delhi had said that Iraq’s Minister of Oil, Abdul Kareem Lualbi, had agreed to increase crude oil exports to India to meet its requirements.
Extending an invitation to Mr. Moily to visit Baghdad in June, Mr. Lualbi also asked Mr. Moily to extend support to Indian companies working in Iraq, especially those engaged in the field of oil and natural gas.
As exports of crude oil from Iran have been on the decline for the last two years, after imposition of sanctions by the U.S. and European Union, Iraq has replaced Iran as the second largest exporter of crude oil to India. Saudi Arabia, however, still remains the largest exporter of crude to India.
India has been maintaining that it is not slowing down crude oil imports from Iran but state-owned refiners have gone ahead and cut their sourcing from Iran by almost 10-12 per cent.
Till last year, Iran was India’s second biggest crude oil supplier, catering to about 12 per cent of the country’s needs. However, of late, it has been replaced by Iraq, with domestic refiners such as Hindustan Petroleum Corporation Limited, Mangalore Refinery and Petrochemicals Limited and private sector refiner Essar Oil having cut sourcing from Iran. Indian Oil Corporation and Reliance Industries Limited (RIL) have shifted their sourcing from Iran to Iraq.
Indian refiners imported 171.41 million tonnes of crude oil in 2011-12.
Of this, 32.63 million tonnes came from Saudi Arabia, 24.51 million tonnes from Iraq, 17.67 million tonnes from Kuwait, and 15.79 million tonnes from the UAE. India imported 271,200 barrels per day (bpd) of oil from Iran between April and February 2012-13, which was below the government’s target of 310,000 bpd for the fiscal year ended March 31.
Oil imports from Iran have come down to around 7.3 per cent in the period from last April to February, as compared to 11 per cent in the previous year.