India’s Sept oil demand remains robust, 2022 consumption on track: S&P Global Commodity Insights

New Delhi [India], October 13 (ANI): India’s September oil product demand was flat month on month but up on the year by 334,000 b/d on a weak base in the previous year, driven by diesel and petrol consumption, which were up by 179,000 barrels per day (b/d) and 65,000 b/d, respectively, a report said.
Modest growth was also seen for other products such as LPG, kerosene/jet fuel, fuel oil and minor products, except naphtha which declined by 21,000 b/d, according to the research and analysis of S&P Global Commodity Insights.
The report said indicators of mobility remained robust in early October at 24 per cent higher than pre-pandemic levels and 0.9 per cent over September’s levels, based on Google data. As per AirNav Radar Box, India’s domestic flight travel in early October was 7 per cent below pre-COVID-19 levels, improved by 3 percentage points from September. International travel was down 16 per cent from pre-pandemic levels in early October, unchanged from levels in September.
The report also said India’s consumer inflation rose to 7% in August from 6.7% in July and is likely to trend higher in September due to higher food prices. The Reserve Bank of India (RBI) raised the policy rates by 50 basis points on September 30 in its continued efforts to tame inflation and control currency depreciation. This is the fourth hike by RBI since May, when it reversed its accommodative stance and raised policy rates by a total of 190 basis points.
India’s manufacturing purchasing managers’ index (PMI) stood at 55.1 in September after the headline figure slipped from 56.2 in August. The report said still, this was the fifteenth straight month of growth in factory activity despite global headwinds and growing recession risks. It said the latest services reading was the weakest expansion in the sector in six months as both output and new orders grew at the slowest rates since March amid inflationary pressures and competitive conditions.
In the near term, S&P Global Commodity Insights said it believes India’s oil demand to rise sequentially by 180,000 b/d in the fourth quarter (Q4) after the monsoon season, boosted by festive and holiday seasons. On a year-on-year basis, the demand in Q4 is expected to grow by 75,000 b/d, down from 370,000 b/d over the first three quarters of this year, which was boosted by a low base in the previous year. Overall, the report said India’s oil demand is expected to grow by 300,000 b/d in 2022, before easing to a 230,000-b/d growth in 2023. Middle distillates (diesel and kerosene/jet fuel combined) will account for about half of the growth in 2022, partly due to a slow recovery in 2021, before contributing to about a third of the growth in 2023. India’s oil demand in 2022 is expected to rise 0.8 per cent over levels in 2019 before rising to 5.2 per cent in 2023. (ANI)