IEA sees Indian oil product demand growth slowing in 2024

(Reuters) – The International Energy Agency (IEA) said on Thursday the “explosive growth” in Indian oil product consumption may be coming to an end.

In a monthly report, the IEA projected that India’s oil product demand growth would slow to 2.5% next year from 4.1% in 2023.

Indian oil product deliveries edged higher in November but were underwhelming compared to the usual seasonal rise, the agency noted. Deliveries in November increased by 40,000 barrels per day (bpd), compared with the typical seasonal upswing of 170,000 bpd.

Data from the Indian oil ministry’s Petroleum Planning and Analysis Cell (PPAC) showed that India’s fuel consumption in November fell after hitting a four month peak in the previous month, hit by reduced travel in the world’s third biggest oil consumer as a festive boost fizzled out.

According to the IEA, the annual 2023 gains will be 220,000 bpd. It sees growth slowing down to 110,000 bpd in the fourth quarter of 2023.

The IEA put the rate of increase in 2024 at 140,000 bpd. That would still be the second-highest growth globally, but far lower than China’s 710,000 bpd.

(Reporting by Anushree Mukherjee and Ashitha Shivaprasad in Bengaluru; Editing by Mark Potter)