Petro products exports fall 11% in April

India’s exports of refined oil products fell by 11% in April to 1.21 million barrels per day, primarily due to the increase in the domestic demand and weaker export margins, according to data provided by Kpler.

Exports to Asia and Europe – the two top destinations of the country also declined by 25% and 3.4% on month to 446,248 barrels per day and 329,279 bpd respectively.

In value terms, petroleum product exports declined 13.6% in FY24 to $ 84.1 billion, bucking a rising trend of the previous years. India had became a key supplier of refinery products to the world as many countries stopped direct trade with Russia after its war with Ukraine. To be sure, in volume terms, these exports grew even in FY24.

Data sourced from another ship tracking intelligence firm Vortexa showed a similar trend, with total exports declining to 1.15 million barrels per day in April from 1.37 million bpd in March.

“The overall decline in refined products exports may be attributed to robust domestic demand, and weaker export margins,” said Vortexa’s Head of APAC Analysis, Serena Huang. She noted that exports to Southeast Asia fell in April off the back of ample supplies in the region.

India’s diesel exports slumped 13% month-on-month in April to over 438,704 bpd and that of gasoline exports fell by 17% to 251,681 barrels per day. Jet fuel exports however rose marginally by 3.7% to 163,545 bpd.

Asia’s share in Indian petroleum products exports decreased to 36.8% in April against 43.5% in March. Europe’s share, however, increased to 27.2% last month from 25% in the previous month but still remains substantially lower than the 32% share it held during the same period last year.

Ample supplies from the US and Middle East to Asia and Europe resulted in weaker demand for these products from India. The inclination of European countries towards US and the Middle East for purchases can be attributed to the fact that voyages from India are opting for the longer route around Africa to reach Europe due to the Red Sea crisis which has also resulted in increased freight costs.

Even as the exports to Europe have moderated from the earlier low levels amid tensions at the Red Sea, the volume is still short of the 350,000-400,000 barrel a day average India supplied to Europe in November and December.

The tensions at the Red Sea has caused Indian shipments to Europe to opt for the longer route via the Cape of Good Hope for the delivery, resulting in higher shipping costs. Africa’s Cape of Good Hope shipping route can extend voyages for up to 14 days or beyond, as per industry experts.

India exports a variety of goods via the Red Sea including petroleum products. The country’s export of petroleum products fell by 14% in FY24 to $84.14 billion compared to $97.47 billion in FY23, government data showed.

India has emerged as a major fuel supplier to Europe in the past few months after European countries started boycotting Russian supplies post its invasion of Ukraine.

The country’s demand for petroleum products including jet fuel, diesel, LPG among others is likely to grow to 239 million tonnes in the financial year 2024-25, as per estimates by the Petroleum Planning and Analysis Cell. The country’s consumption of petroleum products stood at 233 million tonnes last year.