The Oil Ministers of India and Iraq on Tuesday discussed avenues to increase annual crude oil trade beyond 1 billion barrels as well as explore opportunities for Indian companies to invest in the Arab nation’s upstream sector.

India’s Oil Minister Hardeep Singh Puri met Iraq’s Deputy Prime Minister and Minister of Oil Hayan Abdul Ghani Abdul Zahra Al Sawad in Delhi as part of the 18th India-Iraq Joint Commission for Economic & Technical Cooperation.

“We discussed matters pertaining to trade and economic cooperation, hydrocarbon trade, crude oil sourcing, infrastructure upgradation, upstream investment in Iraq, South-South cooperation and cultural ties,” Puri tweeted.

India, a demand centre of energy resources

Today India is the world’s third largest energy consumer, consumer of oil, LPG consumer as well as fourth largest LNG importer, refiner and automobile market in the world. India will continue to be one of the largest demand centre of energy resources, he added.

He further said “India as a major oil consumer and, Iraq as one of the biggest oil producers in the world have significant synergies. Since 2017, Iraq is the top-most supplier of crude oil to India. India already purchases about 1 million barrels per day of crude oil from Iraq. India attaches high priority to a multi-dimensional and comprehensive partnership with Iraq and is the 2nd largest trade partner of Iraq with annual trade worth $37 billion. India’s annual hydrocarbon purchase is of one billion barrels. We discussed ways to ramp this up.”

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In addition to matters pertaining to energy and hydrocarbon trade, Puri said the two sides also discussed ways of further expanding the trade basket and strengthening cooperation in other fields, including trade and investment, health and education, sports, medical tourism and capacity building.

Oil suppliers

In May 2023, India imported 839,000 barrels per day from Iraq against 828,000 barrels a day in April. It was around 1 million barrels per day (mb/d) in December 2022 and 1.14 mb/d in March 2022.

Russia has become India’s largest crude oil supplier with 1.96 mb/d of the key commodity surpassing the traditional trading bloc, Middle East, for the first time in May this year.

The middle eastern nations—Iraq, Saudi Arabia, The UAE, Kuwait, Oman and Qatar—cumulatively supplied the world’s third largest energy consumer with around 1.81 mb/d last month, data provided by the energy intelligence firm, Vortexa showed.

Iraq is also inviting foreign companies in the exploration and production (E&P) sectors, particular for gas as the Arab nation aims to reduce its dependence on gas imports from Iran, trade sources said.

Earlier this month, Iraq’s Oil Ministry initiated efforts to attract investment in 11 gas fields. On June 18, the ministry announced the bid rounds inviting participation from international energy companies. Majority of the blocks are in Anbar province in western Iraq. In May, the Iraqi government also announced an appendix to its fifth bidding round, offering 13 sites across northern, central and southern parts of Iraq.