India’s petroleum exports touch 18-month low in January

New Delhi: Petroleum product exports from India to Europe declined  to an 18-month low in January, 2024. Data released by the commodity market analytics firm Kpler revealed this.

India’s diesel exports to Europe crashed to around 40,000 bpd in January. It  had touched a record high of over 287,000 barrels per day (bpd) in December, 2023. Consequently, India’s overall petroleum product exports to Europe in January fell almost 70 per cent from December to around 111,500 bpd — the lowest since July 2022. Total petroleum product exports of the country in January declined nearly 18 per cent from December levels to 1.11 million bpd.

Countries that saw a spurt in petroleum product dispatches from India in January vis-à-vis December include Saudi Arabia, Australia, Indonesia, Japan, Oman, Sri Lanka, and Bangladesh, among others.

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As per market experts, this decline is due to the security concerns in the Red Sea region. Several shipping companies avoid the Suez Canal route due to ongoing tension in Red sea region. Over the past couple of months, a number of cargo ships have come under attack from the Yemen based Houthi rebels, around the Bab el-Mandeb strait, which leads to the Red Sea and Suez Canal, forming the shortest, route to the Mediterranean Sea and beyond from the Arab Peninsula, North-East Africa, and the Arabian Sea.

Major shipping now  take the much longer route around Africa via the Cape of Good Hope. The majority of Indian fuel exports to Europe are now going around Africa, adding 15-20 days to the voyage.

After the Russia-Ukraine war, India emerged as the largest buyer of Russian seaborne crude and also a major fuel supplier to Europe. India is the world’s third-largest consumer of crude oil and depends on imports to meet over 85 per cent of its domestic requirement. The country, however, is a net exporter of petroleum products as its refining capacity of around 5 million bpd is higher than the demand in the domestic market.