Baghdad has said that it will waive a requirement for Indian refiners to pay for Iraqi crude oil on letter of credit (L/C) terms.

Iraq is also prepared to double the credit period on crude sales to 60 days if Indian refiners buy more in 2014, according to the head of refineries at Hindustan Petroleum.

New terms

B K Namdeo told Reuters that, "Iraq is very positive. They are willing to raise the credit period to 60 days and waive... [the] opening of L/Cs provided volumes are increased."

It is not clear whether the Hindustan Petroleum will benefit from the Iraqis' offer as the refiner has not yet worked out its crude import requirements for 2014.

Changing suppliers

Iraq replaced Iran as India's second biggest oil supplier in 2011, and in the year ending March 2013, Iraq supplied about 13 per cent of India's oil imports, according to preliminary government figures.

Iraq and Saudi Arabia both moved in to become larger suppliers to India after western sanctions made opening L/Cs for trade with Iran difficult.

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