Economic Update – Baghdad
India has announced a planned increase in its oil imports from Iraq throughout 2025, with projections indicating a consumption rate constituting 25% of the average global oil demand.
“India will augment its crude oil imports from primary suppliers in the Middle East, particularly Iraq and Saudi Arabia, in light of the recent sanctions imposed on Russia,” stated the Director General of the Indian Petroleum Corporation. “This strategy is anticipated to raise the import volume by 80%.”
He further elaborated, “The supply of crude oil from Russia might encounter challenges due to heightened shipping costs stemming from a new round of sanctions targeting Moscow. Nonetheless, India’s crude diversification strategy remains robust, ensuring that our refineries continue to be supplied effectively.”
Singh noted that “The reduction in crude oil imports from Russia necessitates sourcing alternative supplies from other regions, including the Middle East, particularly Iraq, Saudi Arabia, Africa, and the United States.”
The United States and the United Kingdom implemented a fresh package of sanctions on the Russian energy sector on January 10. This package introduces restrictions on two prominent Russian oil producers, further amplifying efforts aimed at curtailing oil revenues flowing into Moscow, especially those linked to the shadow oil fleet.
Singh anticipates that India will account for 25% of global oil consumption by 2025, driven by resilient demand in air travel and road transportation, including diesel for trucks, as well as robust industrial activities, construction, and agriculture.
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