Saudi Arabia overtakes Iraq as top oil exporter to India in July: report

Saudi Arabia replaced Iraq as top oil supplier to India in July after a gap of over one year, as higher imports of Iranian oil ahead of the United States sanctions altered trade routes, Reuters reported on Wednesday, citing data from industry and shipping sources.

Saudi Arabia and Iraq remained the two largest oil suppliers to India last month despite a decline in monthly supplies by 12 percent and nearly 23 percent, respectively.

Imports of Iranian oil by New Delhi surged to a record 768,000 barrels per day (bpd) in July due to higher intake by state refiners, according to tanker arrival data.

Higher official selling prices (OSPs) from Saudi Arabia and Iraq in July also influenced demand for their oil, in addition to the various incentives offered by Iran on oil sales.

"Iranian crude OSPs for July have moved in tandem with other middle east producers but incentives offered by Iran has made its oil more attractive compared to other alternatives," Sushant Gupta, Research Director, Asia Pacific Refining, at consultancy Wood Mackenzie.

Meanwhile, purchasing from other importers such as Japan, South Korea and Europe have also shifted more volumes towards India, Gupta added.

"The deadline to reduce Iranian crude is November 4. So with this increase in July, India would show a bigger cuts in Iranian crude come Q4 2018," he added.

State-owned Saudi Aramco raised July Arab Light crude price to Asia to four-year high while Iraq raised the official selling prices for Basra Light crude to Asia by $0.40 a barrel.