India’s exports of petroleum products in the first five months of 2024-25 declined by 2% on year to 6.2 million barrels/day in April-August period of 2023-24, as per data from energy cargo tracking firm Vortexa.
In August, however, the total export of petroleum products increased by 5% to 1.30 million barrels per day compared with 1.24 million barrels per day registered in the previous month.
The country’s top destinations for the exports in August were southeast Asia, northwest Europe, and the Middle East.
Exports to Europe declined by 8% last month to 217,714 barrels per day and supplies to southeast Asia slumped by 32.4% to 182,744 barrels per day compared to the previous month. Exports to the Middle East also decreased by 10% to 185,087 in August.
“India’s refined product exports to Southeast Asia (mainly Singapore and Malaysia) have declined amidst growing surplus in the region, and slowing demand from end destination markets. Indonesia’s clean product imports have slowed in August, with its domestic refineries ramping up runs, dampening its import demand,” said Serena Huang, head of Asia Pacific analysis at Vortexa.
India primarily supplies petroleum products to countries in Europe and Asia. The country 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.
Indian refiners have instead exported more to northeast Asia, likely driven by higher import demand.
Asia’s share in Indian petroleum products exports decreased to 14% in August against 22% in July. Europe’s share, also, decreased to 17% last month from 19% in the previous month. The Middle East accounted for 14.2% of India’s total export volume in August against 16.4% in July.
The country exports a variety of goods via the Red Sea including petroleum products. However, the traffic diversion from the Red Sea and around the Cape of Good Hope on the back of escalating tensions over the Sea has added ten days to Asia-Europe journeys while also increasing fuel costs, as per the Economic Survey released by the government.
“Although global shipping costs returned to pre-pandemic levels by the middle of last year, container shipping rates have risen again,” the survey noted. “Extended detours around the Cape of Good Hope have led to a significant surge in ocean freight rates, reaching up to $10,000 per 40-foot container. Moreover, the Suez Canal Authority has declared a 5-15% hike in transit fees for ships passing through the Panama Canal.”
Meanwhile the domestic consumption of petroleum products during April to July increased to 80.9 million tonnes against 77.2 million tonnes in the same period in FY24, as per data from Petroleum Planning and Analysis Cell. The growth is majorly driven by growth in demand for diesel, aviation turbine fuel, and liquified petroleum gas.
The country produced 94.5 million tonnes of petroleum products during April to July, up from 92.2 million tonnes in the same period of FY24.
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.