Petroleum products exports up 3.3% in May

NEW DELHI : After registering a drop of over 11% in April, India’s export of refined oil products regained momentum and rose marginally last month as the demand increased. The country exported 1.24 million barrels per day of petroleum products in May, registering a marginal increase of 3.3% against 1.20 million barrels per day in April, data from ship tracking intelligence firm Vortexa showed.

Exports, however, remained largely unchanged from the corresponding period of last year at 1.25 million barrels per day. 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.

However, going forward, supplies to Europe may see a decline due to ample supplies in the West. “Asia, Europe and Africa are the top destinations for India’s refined product exports. However, more clean product exports are heading to Asia this month, instead of Europe, as arbitrage to the West has narrowed due to ample supplies,” said Serena Huang, Vortexa’s Head of APAC Analysis.

The country 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, according to government data. The slight uptick in the country’s exports also comes amidst rising domestic consumption of these petroleum products, majorly driven by growth in demand for diesel, aviation turbine fuel, and liquified petroleum gas. The consumption of petroleum products grew by 6% to 19.9 million tonnes in April, as per data from the Petroleum Planning and Analysis Cell.

The country’s production of petroleum products has also seen a rise in the beginning of the current financial year, marking a rise of 4% to 23.4 million tonnes in April compared with the same period of previous year. Even though India’s petroleum products exports may be marginally outpacing the overall outward shipments, imports of these items are rising. As a result, the country’s self-sufficiency in oil products has been witnessing a decline from 14.5% in 2011-12 to 12.6% in 2022-23, and further to 12.2% in FY24, PPAC data showed.

In April, the country’s import of petroleum products registered an increase of 34.4% to 4.3 million tonnes at $2.1 billion, a 40% rise from April 2023. Exports, on the other hand, rose just by 9% on year to 4.8 million tonne at $3.7 billion during the month. 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 PPAC. The country’s consumption of petroleum products stood at 233 million tonnes last year.