India’s Crude Throughput Rates Soar to 7-Month High as Demand Traces Back

As per the data emanated by the Indian government, crude throughput has showcased an astonishing recovery in October, portraying a profound shift in its market fundamentals since March when India underwent a nationwide lockdown to curb Coronavirus. Although the overall throughput registered a drop by 16.1 per cent from previous financial year but was still high as compared to the slump experienced in the past 7 months. Indian refiners like Indian Oil Corporation (IOC) and Bharat Petroleum Corporation (BPC) disclosed to have ramped up their operations since late September under optimism over a substantial pick up in demand in November on arrival of the festive season. IOC, the leading refiner of India even reported to be operating at its full capacity since the beginning of November as demand for fuel have retraced momentum with resumption in market and trading activities across the country. Furthermore, overall demand for crude products jumped by 2.5 per cent to 4.5 million barrels per day in October on y-o-y basis.

The unlocking of the fifth phase of lockdown between 1^st October and 30^th November is perceived to be the prime reason for the positive shift in demand fundamentals for fuels in the country. International Energy Agency (IEA) stated that despite majority of the advanced global economies showcasing a declining trend, any positive movement in the overall fundamentals is derived from developing economies and emerging markets under India.

As per ChemAnalyst, “Although few of the downstream sectors in Indian economy are still struggling under the impact of the global contagion, rising oil demand in the country is anticipated to soon aid the overall market fundamentals in the country.