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Yahoo
30-05-2025
- Business
- Yahoo
India's Oil Demand Growth Could Disappoint Market Bulls
India is overtaking China as the world's biggest oil demand growth driver in a momentous shift in the oil market where China dominated growth in the past two and a half decades. While India's growth rate is ahead of China's, Indian volumes aren't anywhere near the Chinese boom in consumption that began in the early 2000s. And they never will be. With the pace of Chinese growth decelerating and India's accelerating, market bulls are correct to expect that India will lead demand growth numbers. But they could be disappointed that Indian demand growth isn't soaring at a pace similar to China's. In the period 2000-2025, Chinese demand growth averaged 485,000 barrels a day (bpd), as pointed out by Bloomberg Opinion columnist Javier Blas. India's total oil demand is about 6 million bpd at present, and it is growing at around 200,000 bpd every year. This is less than half of China's booming annual demand growth in the 2000s and the COVID slump in demand everywhere, India's oil consumption growth has settled at about 150,000 bpd to 200,000 bpd each year. It's expected to continue at around these levels, forecasters say. China, for its part, faces major structural shifts in its economy and transportation sector, with slower GDP growth, a weak property market, and booming electric vehicle sales and sales of trucks running on LNG that are displacing part of the gasoline and diesel consumption. India surpassing China as the world's top driver of oil demand growth isn't surprising at all. The surprise, if any, came from the fact that this is happening a bit earlier than many forecasters had expected a year or two key to looking at this shift is to see that China's oil demand growth is slowing while India's isn't soaring. Indian demand is rising, but not anywhere close to the Chinese boom of the past two decades. So, those who expect India to be the 'next China' could be in for a demand growth in China will be just 1.5% this year compared to 2024, according to OPEC's latest Monthly Oil Market Report. India's demand will grow by 3.4%-- so the growth in India is higher than in China. But China is expected to consume more than 16 million bpd of oil this year, compared to India's 6 million bpd. In India, oil demand in March was slightly lower than in the same month last year, OPEC said in its report. Definitely not an estimate oil bulls, Saudi Aramco, or other oil companies wanted to hear. Diesel and other transportation fuels will support India's oil product demand, which is expected to grow by 188,000 bpd this year from 2024 to average 5.7 million bpd, OPEC said in its report in May. Next year, oil demand is projected to grow by 246,000 bpd year-over-year to average 6.0 million bpd, 'supported by robust economic growth amid healthy transportation and manufacturing activities,' the cartel noted. This should be good news about Indian demand growth, considering the volatile U.S. trade and tariff policy, which could quickly dampen economic and market sentiment several times by the end of this year alone. But 246,000-bpd annual growth in India next year would compare to China's nearly 500,000-bpd growth in each of the years 2000 through 2025, with the exception of a couple of crises with the global financial crisis and COVID. Now China's consumption of transportation fuels has peaked, many forecasters and state giant China National Petroleum Corporation (CNPC) say. Some of the weakness in Chinese oil demand growth has been attributed to China's weaker economic performance over the past year. But the shift toward EVs and LNG trucks is removing some road fuel demand permanently, analysts say. India could see an acceleration of oil demand growth in the next decade as incomes rise and consumers spend more on consumer goods. India will be the fastest-growing oil demand region among large economies, Nikhil Bhandari, Co-head of APAC Natural Resource & Clean Energy Research at Goldman Sachs, told CNBC earlier this week. Income growth and rising manufacturing will result in India accounting for a third of global oil demand growth over the next decade, Bhandari said. As a rule of thumb, at a certain level of income growth, there is acceleration of oil demand as consumers buy more consumer goods apart from staples, the expert noted. And India is currently at an inflection point of income growth, which would accelerate oil demand growth over the next decade, according to Goldman Sachs's Bhandari. Although India's growth in percentage terms exceeds China's growth pace, China still consumes significantly more oil—around triple the total amount India uses. And when the biggest oil importer in the world, China, begins to see slowing growth, India isn't able to offset the slowdown or replicate the boom in demand. By Tsvetana Paraskova for More Top Reads From this article on
Mint
15-05-2025
- Business
- Mint
India's oil demand to rise 3.4% in 2025, fastest among major economies: OPEC
India's oil demand is expected to grow at the fastest pace among major economies and double the rate of rise in China in 2025 and 2026, oil cartel OPEC said in its latest global outlook. India's oil demand is projected to rise from 5.55 million barrels a day in 2024 to 5.74 million bpd in 2025, up 3.39 per cent, helped by rising energy needs in the world's fastest growing economy. This is projected to further rise to 5.99 million bpd in 2026, growing at 4.28 per cent. The demand growth is higher than 1.5 per cent expansion projected in China's oil demand in 2025 and 1.25 per cent in 2026. But in absolute terms, the US will continue to be the biggest oil consumer with a demand of 20.5 million bpd in 2025, followed by China (16.90 million bpd in 2025 and 17.12 million bpd in 2026). India is the third largest consumer. The US is likely to see 0.09 per cent growth in 2025 and 0.6 per cent in 2026. Despite slower growth, OPEC expects global oil demand to rise by 1.3 million bpd in both 2025 and 2026, unchanged from its previous forecast. "Looking ahead, India's economy continued to expand at the beginning of the year. The current momentum of robust economic growth is expected to continue, driven by ongoing consumer spending, investment and government support for key sectors," the OPEC Monthly Oil Market Report said. While the most recently introduced US tariffs may have an impact on Indian GDP growth, some of these impacts are expected to be compensated for by fiscal and monetary stimulus measures, it said, adding forward-looking indicators point towards strong economic dynamics. "Accordingly, the outlook for the near term provides further positive signals for steady oil demand in India. Diesel is projected to continue to be the main driver of demand growth," the report said. With massive road expansion underway, bitumen demand is seen growing strong. "Additionally, robust growth in transport fuels, with strong expectations for manufacturing and growth in petrochemical feedstock requirements, is expected to support overall oil demand growth," the report said. "Overall, in 2025, oil product demand in India is expected to grow by 188,000 bpd, year-on-year, to average 5.7 million bpd." In 2026, ongoing trade-related negotiations are expected to reduce currently announced tariffs, limiting the impact. "India's economy is expected to continue expanding amid strong manufacturing and service sector activities, supported by a continuation of current government support in key sectors amid inflation easing. Accordingly, oil demand is projected to grow by 246,000 bpd, y-o-y, to average 6.0 million bpd, supported by robust economic growth amid healthy transportation and manufacturing activities," it added. India is more than 85 per cent dependent on imports to meet its needs of crude oil, which is turned into fuels like petrol and diesel in refineries. OPEC report said India's crude imports set a record high of 5.4 million bpd in March, following a month-on-month increase of over 5 per cent. Product imports rose by 2 per cent, m-o-m, amid higher inflows of LPG. Product exports slipped by almost 3 per cent, m-o-m, but remained at strong levels, as declines in naphtha and gasoline were offset by increased outflows of diesel and fuel oil. "In terms of crude imports by source, Kpler data shows Russia had a 36 per cent share of India's total crude imports in March, up from 31 per cent in the previous month. Iraq was second with 17 per cent, followed by Saudi Arabia with 11 per cent," it said.
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Business Standard
15-05-2025
- Business
- Business Standard
OPEC sees India's oil demand rising 3.4% in 2025, double the pace of China
India's oil demand is expected to grow at the fastest pace among major economies and double the rate of rise in China in 2025 and 2026, oil cartel OPEC said in its latest global outlook. India's oil demand is projected to rise from 5.55 million barrels a day in 2024 to 5.74 million bpd in 2025, up 3.39 per cent, helped by rising energy needs in the world's fastest growing economy. This is projected to further rise to 5.99 million bpd in 2026, growing at 4.28 per cent. The demand growth is higher than 1.5 per cent expansion projected in China's oil demand in 2025 and 1.25 per cent in 2026. But in absolute terms, the US will continue to be the biggest oil consumer with a demand of 20.5 million bpd in 2025, followed by China (16.90 million bpd in 2025 and 17.12 million bpd in 2026). India is the third largest consumer. The US is likely to see 0.09 per cent growth in 2025 and 0.6 per cent in 2026. Despite slower growth, OPEC expects global oil demand to rise by 1.3 million bpd in both 2025 and 2026, unchanged from its previous forecast. "Looking ahead, India's economy continued to expand at the beginning of the year. The current momentum of robust economic growth is expected to continue, driven by ongoing consumer spending, investment and government support for key sectors," the OPEC Monthly Oil Market Report said. While the most recently introduced US tariffs may have an impact on Indian GDP growth, some of these impacts are expected to be compensated for by fiscal and monetary stimulus measures, it said, adding forward-looking indicators point towards strong economic dynamics. "Accordingly, the outlook for the near term provides further positive signals for steady oil demand in India. Diesel is projected to continue to be the main driver of demand growth," the report said. With massive road expansion underway, bitumen demand is seen growing strong. "Additionally, robust growth in transport fuels, with strong expectations for manufacturing and growth in petrochemical feedstock requirements, is expected to support overall oil demand growth," the report said. "Overall, in 2025, oil product demand in India is expected to grow by 188,000 bpd, year-on-year, to average 5.7 million bpd." In 2026, ongoing trade-related negotiations are expected to reduce currently announced tariffs, limiting the impact. "India's economy is expected to continue expanding amid strong manufacturing and service sector activities, supported by a continuation of current government support in key sectors amid inflation easing. Accordingly, oil demand is projected to grow by 246,000 bpd, y-o-y, to average 6.0 million bpd, supported by robust economic growth amid healthy transportation and manufacturing activities," it added. India is more than 85 per cent dependent on imports to meet its needs of crude oil, which is turned into fuels like petrol and diesel in refineries. OPEC report said India's crude imports set a record high of 5.4 million bpd in March, following a month-on-month increase of over 5 per cent. Product imports rose by 2 per cent, m-o-m, amid higher inflows of LPG. Product exports slipped by almost 3 per cent, m-o-m, but remained at strong levels, as declines in naphtha and gasoline were offset by increased outflows of diesel and fuel oil. "In terms of crude imports by source, Kpler data shows Russia had a 36 per cent share of India's total crude imports in March, up from 31 per cent in the previous month. Iraq was second with 17 per cent, followed by Saudi Arabia with 11 per cent," it said. (Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)
Time of India
15-05-2025
- Business
- Time of India
OPEC sees India's oil demand rising 3.4% in 2025, double the pace of China
India's oil demand is expected to grow at the fastest pace among major economies and double the rate of rise in China in 2025 and 2026, oil cartel OPEC said in its latest global outlook. India's oil demand is projected to rise from 5.55 million barrels a day in 2024 to 5.74 million bpd in 2025, up 3.39 per cent, helped by rising energy needs in the world's fastest growing economy. This is projected to further rise to 5.99 million bpd in 2026, growing at 4.28 per cent. The demand growth is higher than 1.5 per cent expansion projected in China's oil demand in 2025 and 1.25 per cent in 2026. But in absolute terms, the US will continue to be the biggest oil consumer with a demand of 20.5 million bpd in 2025, followed by China (16.90 million bpd in 2025 and 17.12 million bpd in 2026). India is the third-largest consumer. The US is likely to see 0.09 per cent growth in 2025 and 0.6 per cent in 2026. Despite slower growth, OPEC expects global oil demand to rise by 1.3 million bpd in both 2025 and 2026, unchanged from its previous forecast. "Looking ahead, India's economy continued to expand at the beginning of the year. The current momentum of robust economic growth is expected to continue, driven by ongoing consumer spending, investment and government support for key sectors," the OPEC Monthly Oil Market Report said. While the most recently introduced US tariffs may have an impact on Indian GDP growth, some of these impacts are expected to be compensated for by fiscal and monetary stimulus measures, it said, adding forward-looking indicators point towards strong economic dynamics. "Accordingly, the outlook for the near term provides further positive signals for steady oil demand in India. Diesel is projected to continue to be the main driver of demand growth," the report said. With massive road expansion underway, bitumen demand is seen growing strong. "Additionally, robust growth in transport fuels, with strong expectations for manufacturing and growth in petrochemical feedstock requirements, is expected to support overall oil demand growth," the report said. "Overall, in 2025, oil product demand in India is expected to grow by 188,000 bpd, year-on-year, to average 5.7 million bpd." In 2026, ongoing trade-related negotiations are expected to reduce currently announced tariffs, limiting the impact. "India's economy is expected to continue expanding amid strong manufacturing and service sector activities, supported by a continuation of current government support in key sectors amid inflation easing. Accordingly, oil demand is projected to grow by 246,000 bpd, y-o-y, to average 6.0 million bpd, supported by robust economic growth amid healthy transportation and manufacturing activities," it added. India is more than 85 per cent dependent on imports to meet its needs of crude oil , which is turned into fuels like petrol and diesel in refineries. OPEC report said India's crude imports set a record high of 5.4 million bpd in March, following a month-on-month increase of over 5 per cent. Product imports rose by 2 per cent, m-o-m, amid higher inflows of LPG. Product exports slipped by almost 3 per cent, m-o-m, but remained at strong levels, as declines in naphtha and gasoline were offset by increased outflows of diesel and fuel oil. "In terms of crude imports by source, Kpler data shows Russia had a 36 per cent share of India's total crude imports in March, up from 31 per cent in the previous month. Iraq was second with 17 per cent, followed by Saudi Arabia with 11 per cent," it said.
Time of India
15-05-2025
- Business
- Time of India
IEA raises 2025 oil demand forecast slightly amid softer trade tensions and lower prices
Global oil demand is now projected to grow marginally more than previously expected in 2025, the International Energy Agency (IEA) said Thursday, citing easing trade tensions and a decline in crude prices as key factors supporting consumption. The Paris-based energy watchdog revised its oil demand growth forecast to 740,000 barrels per day (bpd) for the year, up from 730,000 bpd projected in its April report. This adjustment comes amid signs that the global economic impact of the recent US tariff measures may be less severe than initially feared, as reported news agency AFP. US President Donald Trump's sweeping tariff announcement in April — which imposed a 10% import levy on goods from nearly every nation — had triggered volatility in global financial markets and raised concerns of an economic slowdown. However, the subsequent decision to pause additional tariffs on key trading partners has slightly improved the outlook for global trade and energy demand. The IEA noted that 'subsequent pauses, concessions, exemptions and negotiations are likely to attenuate the levies' permanence and economic impact.' It added that the overall macroeconomic backdrop remains uncertain. "Still, policy uncertainty is high, weighing on consumer and business sentiment," the agency said in its Monthly Oil Market Report. The IEA said global oil demand reached 990,000 bpd in the first quarter of 2025, but growth is expected to moderate to 650,000 bpd for the remainder of the year. This slowdown reflects ongoing "economic headwinds" and the accelerating adoption of electric vehicles, which are beginning to make a measurable impact on oil consumption patterns. Oil prices fell significantly last month, influenced both by Trump's tariff measures and a surprise production increase by OPEC+ nations. The IEA noted that these lower prices are likely to stimulate short-term consumption, helping to offset some of the expected demand drag later in the year. In total, the IEA forecasts global oil demand will reach 103.9 million bpd in 2025. Stay informed with the latest business news, updates on bank holidays and public holidays . AI Masterclass for Students. Upskill Young Ones Today!– Join Now
