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Informist, Tuesday, Nov. 5, 2024

By Afra Abubacker

NEW DELHI – India's crude oil imports are expected to rise in November on strong festival season demand, Serena Huang, head of Asia-Pacific analysis at Vortexa, a global oil and gas data and analytics firm, said. In October, India's total crude oil imports fell 10.4% on month to 4.24 million barrels per day, Vortexa's data showed.

According to Huang, imports declined last month partly because of higher shipments in September. Imports also declined because of volatility in crude oil prices and seasonal maintenance shutdowns of domestic refineries.

However, Indian refiners are likely to import more crude oil in November as the festival and wedding season is likely to boost travel and automobile purchases, the agency said. Further, diesel demand for irrigation is likely to rise with the onset of rabi sowing.

In October, imports from Russia fell 7% on month to 1.7 million barrels per day, according to data from Vortexa, which tracks global oil and gas shipments in real time. Strong Chinese demand for Russian crude had pushed back Indian refiners' purchases in October, she said. However, trade flow through the northern sea route from Russia to China is expected to slow down in November with the onset of winter, Huang said.

"With India's crude oil demand rising, and Chinese import demand remaining relatively bearish, we could see a reversal of trends, with a rebound in Russian crude imports into India in November," Huang told Informist in a note. Though discounts on Russian crude oil have narrowed, Moscow remains the most sought-after supplier for Indian refiners. India also sources petroleum from Iraq, Saudi Arabia, the United Arab Emirates, and the US.

India's crude oil imports from the US fell 55% on month to 95,896.5 barrels per day in October, the data showed. Ample crude from West Asia and Russia have kept Indian refiners well supplied, Huang said.

India's exports of petroleum products fell 21.4% on month to 1.23 million barrels per day in October. According to Huang, India's export margins have come under "immense pressure in recent months" due to ample supplies of refined products in Europe, Africa, and Asia.

Asked if India's exports to Europe would improve in the coming months, Huang said Vortexa had seen India and West Asia pivot their petroleum product exports away from Europe towards Asia in October. "The momentum could continue if Europe remains well supplied," she said.

On prices, Huang sees crude oil futures on the New York Mercantile Exchange hovering around $70 per barrel in November. At the time of writing this report, the December West Texas Intermediate contract on NYMEX was down 1.2% at $71.12 per barrel.  End

Edited by Rajeev Pai

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