India’s crude oil imports in the current month are expected to rebound from the lows in October 2024 as domestic refineries come back online from maintenance and refinery runs surge in anticipation of the seasonally stronger domestic demand in Q4 2024.
The October-December period is marked by an increase in consumption of refined petroleum products, particularly diesel, petrol and jet fuel, as the festival and marriage season lifts consumption.
Besides, some demand also comes from the rabi sowing season as well as from the year-end vacation travel that pushes up usage of aviation turbine fuel (ATF).
“India’s crude imports are poised for recovery in November as key refineries, including Mangalore, Kochi, and Mathura, come back online after maintenance.
Refinery runs are projected to rise by 250,000 barrels per day (b/d) m-o-m to 5.41 million barrels per day (Mb/d), the highest since July,” global real-time data and analytics provider Kpler said in a report.
October imports had fallen to 4.34 Mb/d, the lowest in over a year, but November is expected to see a rebound to 4.87 Mb/d, supported by stable domestic production at around 590,000 b/d, it added.
Kpler projected that Russia will remain India’s largest crude supplier, though imports are unlikely to exceed 2 M/bd in the near term.
“This is due to higher Russian refinery runs as autumn maintenance concludes and less drone activity impacting its facilities,” it added.
However, Iraq is strengthening its position as the second-largest supplier, with Hindustan Petroleum Corporation (HPCL) expanding its term deal with Iraq’s State Organization for Marketing of Oil (SOMO), the agency pointed out.
In November 2023, India’s crude oil imports from Iraq rose to their highest levels in more than a year at over 1 mb/d.
Meanwhile, Brazil is emerging as a notable source for medium sour grades, with 185,000 b/d arriving in November, the second-highest monthly volume recorded.
This coincides with the visit of Oil Minister Hardeep Sigh Puri to Brazil in September 2024 where he met Petrobras President Magda Chambriard.
The meeting focused on steps to enhance crude oil purchases between Petrobras and Indian energy companies and opportunities to collaborate in India and Brazil, especially in offshore deep/ ultra-deep-water exploration and production projects.
“Shifts in global crude dynamics are also evident as Indian Oil Corporation (IOCL) opts for discounted US WTI barrels over its usual Nigerian grades, driven by weak European demand and stagnation in China,” Kpler said.
“With differentials narrowing, India’s post-maintenance activity highlights its adaptability in securing competitively priced supplies amidst evolving market conditions,” it added.
