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The Saudis just one-upped Iraq in India

Mar 29, 2016, 22:15 IST

Saudi King Salman watches the North Thunder military exercises in Hafr Al-Baten, Saudi Arabia.AP/Saudi Press Agency

Saudi Arabia officially became India's top crude oil supplier.

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The Kingdom exported 60% more crude year-over-year in February, and 24% more than in January, trumping Iraq, according to the latest shipping data obtained by Platts.

Platts reports that Saudi supplies to India came in at 4.43 million metric tons (1.12 million barrels/day) in February, compared with Iraq's 3.27 million metric tons.

Meanwhile, Iraq's supplies were up 192% year-over-year, but still down 7.5% from January.

"The wide gap between Saudi and Iraqi supplies is in contrast to their position in January, when they almost supplied the same volumes and in December, when Iraq overtook Saudi Arabia to become India's top crude supplier," the Platts report noted.

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Given the general slowdown of oil demand and oversupply of oil, India's been looking pretty attractive to oil producers - especially in light of India's strong oil demand growth rate and refining capacity expansion plans.

Still, it hasn't been all peaches and cream for the Saudis.

According to an analysis of customs data, the FT recently noted that the Kingdom lost market share in nine out of 15 top oil markets between 2013 and 2015 (including China, South Africa, and the US), even as it increased output to record levels amid lower oil prices.

Moreover, in January, Saudi Arabia, Russia, Qatar, and Venezuela agreed to freeze oil production at the level of supply produced in January, which some interpreted as a shift in the Saudis' strategy.

And at the time, RBC Capital Markets' Helima Croft noted that the coordinated decision was "an acknowledgment among the oil heavyweights that all is not well, [and] it signals a true potential willingness to be more proactive later in the year."

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Brent crude, the international benchmark, is currently trading around $39.04 per barrel.

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Check out the full story at Platts.

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