India’s crude oil imports to drop in May 2021: S&P Global Platts

The full impact of fall in oil demand from the second wave of the coronavirus will get reflected only in May 2021, analysts at S&P Global Platts have said. India’s crude imports and refinery utilisation levels remained robust last month in April 2021. Indian refiners shipped in cargoes contracted earlier and refrained from backing out of deals in April despite a second wave of the coronavirus triggering demand destruction fears.

“As Indian refiners started to realize the severity of demand impact from lockdown measures, they are expected to reduce runs and some have already done so as sales of the first half in May turned out to be very weak,” Platts said. In April, Indian Oil Corporation had a refinery run rate of 96.1 per cent, which had dropped to 84 per cent in the first 7 days in May.

Crude oil imports increased by 10.3 per cent year-on-year (y-o-y) to 18.3 million tonnes (MT) during April 2021. The value of imports however was higher by 183 per cent to $ 8.5 billion. The Indian basket crude price averaged $ 63.4 a barrel during April against $ 19.90 a barrel in the same month a year ago. Owing to lower international crude oil rates in the earlier half of the fiscal, value of crude imports had fallen 38 per cent y-o-y to $ 62.7 billion in FY21 even though import volumes had decreased by about 13 per cent annually to 198 million tonnes.

Consumption of Petroleum products fell to 17 million tonnes in April, the lowest recorded since September 2020, signalling that the re-imposition of lockdown curbs with the second wave of the coronavirus in many areas has slowed industrial and commercial consumption.

Leave a Reply

Your email address will not be published. Required fields are marked *