India’s oil consumption surged 11 percent to the most on record last year as rising income levels spurred greater use of cars, trucks and motorbikes, expanding fuel demand.
The world’s second-most populous nation consumed 178 million tonnes of oil products last year, up from 161 million tonnes in 2015, according to the Indian Oil Ministry’s petroleum planning and analysis cell.
Gasoline demand increased 12 percent in the year to 21.5 million tonnes and diesel consumption grew 5.6 percent 69.6 million tonnes.
Greater automotive use spurred by rapid economic expansion has made India a bright spot for global oil demand and local refiners are racing to add capacity. The International Energy Agency forecasts India to be the fastest-growing crude oil consumer in the world by 2040.
“We expect gasoline growth at 10 percent” and oil demand to expand by 7.6 percent this year, driven by passenger-vehicle sales, Singapore-based FGE senior consultant Sri Paravaikkarasu said. “Our expectation for oil prices in 2017 is US$50 to US$60 per barrel, which should support robust growth in transport and consumer fuels in India.”
Brent crude traded at US$53.86 a barrel, up 0.4 percent, as of 7:36am in London yesterday.
The global benchmark has lost 5.2 percent this year.
Indian oil consumption last month grew at the slowest pace for the month since 2013, as the government’s cash crackdown skewed the trend. The nation consumed 15 million tonnes of oil products last month, 4.3 percent more than the same period the previous year.
India’s auto sales, including commercial vehicles and motorcycles, rose 9.2 percent last year to 21.9 million, the Society of Indian Automobile Manufacturers said.