Beyond Barrels: How China and India Became Iraq’s Lifeline in 2024

Image Source: ET EnergyWorld

China and India solidified their positions as the engines of Iraq's oil economy in 2024, collectively making up almost 70% of the nation's overall oil export revenue. While Iraq raked in approximately $97 billion in crude exports during the past year, both these Asian titans were its biggest and most important buyers, rewriting both regional and international energy equations.

Major Highlights:

Dominant Purchasers: China bought $38 billion of Iraqi oil in 2024-approximately 40% of Iraq's overall oil export value-before India purchased $29 billion, or close to 30% of the total. Together, their imports brought nearly $67 billion into Iraq's treasury, highlighting their importance to the nation's economy.
Volume Leaders: China averaged 1.19 million barrels a day (bpd) and India 979,000 bpd and thus became the largest two-volume importers. Collectively, they took 60-70% of Iraq's exports, which was much more than other buyers such as South Korea, the UAE, and the US.
Fast Growth: India's imports from the country have increased by 15% each year over the last four years, now accounting for over 20% of India's entire oil imports. Imports from Iraq by China also recorded an 18% compound annual growth, accounting for 35% of China's total oil imports in 2024.
Strategic Partnerships: China's engagement extends beyond imports-Chinese companies now have operations or have acquired rights to 10 major oil and gas fields in Iraq, increasing economic interdependence and China's presence in the region.
Economic Lifeline: Oil exports account for more than 90% of Iraq's government income. The nation exported more than 1.2 billion barrels in 2024, averaging 3.3 million bpd, with 70% of this production exported to Asia, primarily China and India.
Future Outlook: Iraq aims to grow its oil reserves from 145 billion to more than 160 billion barrels through new development projects and China and India are set to continue playing key roles in the expansion.

China and India's oil imports from Iraq, the magnitude and increase of which, secure Asia's largest economies' energy supplies while underpinning Iraq's fiscal stability and future growth.

Sources: Zawya, Shafaq News, The Diplomat