Crude oil Imports Current Affairs - 2019
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According to data released by Directorate General of Commercial Intelligence and Statistics (DGCI&S), Iraq remains India’s top crude oil supplier for second year in a row.
Key Highlights of India’s Oil import Data
- India is world’s third largest importer of crude oil (7% of total crude oil imports) after China (world’s largest importer with 20.2% of total crude oil imports) and USA (13.8%).
- India’s crude oil imports meets 80 % its oil needs.
- Total Import: India imported 207.3 MT (Metric Tons) of crude oil in 2018-19, down from 220.4 MT in 2017-18. This increased India’s total crude oil import bill by 40.6% i.e. to $86.9 billion as compared to $61.8 billion from previous year.
- Iraq: one of largest producers of Organization of Petroleum Exporting Countries (OPEC) is India’s top crude oil supplier for past two years. It meets more than 20% of India’s oil needs in 2018-19 fiscal year by selling 46.61 million tonnes (mt) of crude oil to India.
- Saudi Arabia: largest producer of OPEC has traditionally been India’s top oil import source, but in 2017-18 fiscal year it was dethroned by Iraq for the first time. In 2018-19, Saudi exported 40.33 mt of crude oil to India. Amid restrictions on Iranian crude oil exports, India’s oil imports from Saudi Arabia jumped 53% 3.02 MT in December 2018.
- Iran: the Persian Gulf nation was third largest crude oil supplier to India even when India stopped importing from Iran following re-imposition of economic sanctions by US. It sold 23.9 mt of crude in 2018-19, up from 22.59 mt in the 2017.
- UAE: surpassed Venezuela to become India’s fourth-largest crude supplier. It sold 17.49MT of crude oil to India in 2018-19.
- Venezuela: is one of top five crude oil suppliers to India. But volume of crude sourced from Venezuela has been erratic due to ongoing political and economic crisis and under-investment in sector which is impacting it’s production.
- Nigeria was next biggest supplier with 16.83MT of exports in 2018-19.
- Other Countries: Kuwait supplied 10.78 MT of crude oil and next to it was Mexico which supplied another 10.28 MT.
- United States: It first began selling crude oil to India in 2017 is now fast becoming a major supplier. Supplies from U.S. jumped by more than four times in 2018-19 fiscal year.
Directorate General of Commercial Intelligence & Statistics (DGCI&S)
- It is a premier organization of Govt. of India attached to Ministry of Commerce and Industry.
- Its office is located at Kolkata. It is entrusted with collection, compilation and publishing or dissemination of India’s trade statistics and commercial information.
- Such information is often required by policy makers, researchers, importers, exporters, traders and even overseas buyers.
Iraq has overtaken Saudi Arabia to become India’s top crude oil supplier by supplying 38.9 million tonnes (MT) crude oil in the current financial year. It was fifth of the India’s oil needs.
India is 80% dependent on imports to meet its oil needs. India had imported 184.4 MT of crude oil during April-January period of 2017-18 period as compared to 213.9 MT in the entire 2016-17 fiscal, and 202.8 MT in 2015-16.
Saudi Arabia traditionally has been India’s top oil source but Iraq dethroned it. Saudi Arabia supplied 30.9 MT of crude oil in first 10 months of current fiscal. Iran continued to be third largest supplier, selling 18.4 MT during April-January. This is the second year in a row that Iran has occupied the third position. Venezuela is India’s fourth largest supplier with 15.5 MT during April-January, followed by Nigeria with 14.9 MT.
Imports from West Asia
India’s dependence on West Asia for its crude oil needed has increased from 58% in 2014-15 to 63.7% in April-January period of this fiscal. India had imported 109.9 MT out of 189.4 MT of total crude imports in 2014-15 from region. In the current fiscal so far, West Asia has accounted for 117.5 MT of crude oil supplies to India.
Reasons for increase of imports from Iraq
Iraq was able dethrone Saudi Arabia as India’s largest crude oil supplier mainly by supplying heavily discounted crude compared to crude oil sold by Saudi Arabia at Official Selling Price of OPEC. In given time period, prices of crude oil had shot up following production cuts by OPEC members. However, Iraq did not followed the aggressive pricing due to its heavy dependence on oil revenues to fund its economy. Moreover, Indian refiners in recent years have invested heavily in modernising plants to more efficiently process low grade crudes including Basra heavy crude from Iraq, giving greater flexibility in the cost-saving oil grades they can buy.