After experiencing an 11 per cent decline in April, India’s exports of refined petroleum products rebounded modestly in May, climbing 3.3 per cent to 1.24 million barrels per day, data from ship tracking intelligence firm Vortexa revealed.
This modest monthly uptick brought exports roughly in line with the 1.25 million barrels per day exported during the same period last year.
India has emerged as a major supplier of fuel products to European nations in recent months after the European Union imposed sanctions on Russian energy imports following the invasion of Ukraine.
However, looking ahead, analysts anticipate India’s petroleum product shipments to Europe may taper off as ample Western supplies diminish the profit margins.
“Asia, Europe and Africa remain the top destinations for India’s refined product exports,” said Serena Huang, Head of APAC Analysis, Vortexa.
“However, more clean product exports are heading to Asia this month instead of Europe as the arbitrage opportunity to the West has narrowed due to increased supplies there,” she added.
Domestically, India’s consumption of petroleum products grew by 6 per cent year-over-year in April to 19.9 million tonnes, government data showed.
Demand was driven higher by increased usage of diesel, aviation fuel, and liquefied petroleum gas. Over the same period, India’s production of refined petroleum products rose 4 per cent to 23.4 million tonnes.
Despite the recent rebound in exports, India’s self-sufficiency in petroleum products continues a long-term decline, falling from 14.5 per cent in 2011-12 to 12.2 per cent in the current fiscal year ending March 2024, according to the Petroleum Planning and Analysis Cell.
India imported 4.3 million tonnes of petroleum products in April, up 34.4 per cent from a year earlier.
Overall petroleum product demand in India is projected to grow to 239 million tonnes in fiscal 2024-25 from 233 million tonnes last year as the economy continues expanding.
However, import dependence is likely to rise further unless domestic production increases commensurately.