India’s oil demand is projected to leap 8.2 per cent to five.15 million barrels per day in 2022 because the economic system continues to rebound from the devastation attributable to the pandemic.
The Organization of Petroleum Exporting Countries (OPEC) in its newest month-to-month oil market report projected the world’s third-biggest power shopper so as to add 0.39 million barrels per day (bpd) of crude oil demand in 2022.
India’s oil demand rose from 4.51 million barrels per day in 2020 to 4.76 million bpd in 2021, recording a 5.61 per cent progress.
But, this was under pre-pandemic ranges. Oil demand in 2018 was 4.98 million bpd, which rose to 4.99 million bpd within the following yr earlier than the pandemic struck.
“With expected strong economic growth of 7.2 per cent in 2022 and expected rapid containment of Omicron in the near future, oil demand is expected to recover,” the OPEC report mentioned.
Mobility has continued to enhance, as common driving exercise in India elevated. Oil demand this yr has elevated as states relaxed COVID-19 restrictions in keeping with declines in new infections.
“Gasoline (petrol) and diesel are likely to be particularly favoured by the expected rise in GDP and the already recovering mobility and consequently driving activity,” it mentioned.
Similarly, in keeping with a forecast for a sturdy economic system in 2022, the commercial sector will present assist for diesel, LPG and naphtha necessities.
Jet kerosene demand enchancment is anticipated to be slower in 2022 due to journey challenges, notably business-related, it mentioned. “Nevertheless, India is projected to grow by 0.4 million bpd year-on-year in 2022.” The projection by OPEC is in keeping with the federal government estimates for gasoline demand progress. According to the oil ministry’s Petroleum Planning and Analysis Cell (PPAC), India’s gasoline demand is more likely to develop 5.5 per cent within the fiscal yr starting April 1.
Fuel consumption in 2022-23 is estimated to rise to 214.5 million tonnes (4.3 million bpd) from 203.2 million tonnes anticipated gross sales within the present fiscal yr ending March 2022.
While the OPEC projections are for crude oil demand, the PPAC forecast is for gasoline. Crude oil is transformed into gasoline resembling petrol and diesel at refineries and never all the petroleum merchandise produced are consumed within the nation. A major quantity of petroleum merchandise are additionally exported, leading to variance between crude oil and gasoline demand estimates.
“India’s crude imports averaged 4.5 million bpd in January, down around three per cent from the strong level seen the month before. February data is expected to show higher crude imports, as the economy gains momentum, demand picks up, and refiners boosted runs,” OPEC report mentioned.
Imports make up for 85 per cent of India’s oil wants.
“In phrases of crude imports by supply, the newest knowledge for December exhibits Iraq persevering with to carry the highest place, with a share of 27 per cent.
“Saudi Arabia was second with around 17 per cent, followed by the UAE with some 13 per cent, the latter seeing a jump in volumes. The US also saw a strong increase, rising to fourth place, with nine per cent,” it added.
According to PPAC, India’s gasoline demand will cross the pre-pandemic stage gross sales within the present fiscal. In 2019-20, India had consumed 214.1 million tonnes of petroleum merchandise resembling petrol, diesel and LPG.
Demand for petroleum merchandise grew by 4.2 per cent within the first 10 months of the present fiscal yr that started in April 2021. Fuel consumption was 165.7 million tonnes in April 2021 to January 2022.
India consumed 194.3 million tonnes of petroleum produced in 2020-21, the yr that noticed a pandemic-related lockdown crippling economic system and mobility, and 214.1 million tonnes in 2019-20.