January 22, 2019
India contributed 14 per cent of the global oil demand growth in 2018, or to the tune of 245,000 barrels/day
Transport fuels (gasoline and diesel), and residential LPG will continue to be the two main drivers of demand growth
India holds estimated oil and gas deposit of 28 trillion tonnes, of which 60 per cent is yet to be harnessed
Government is aiming to attract private and foreign technology and investment in developing resources
Oil demand growth in India is set to cross that in China in 2019, as per a report by Wood Mackenzie, a UK-based energy and resources consultancy, on January 22. Driven by a spike in overall consumption as well as an expansion in consumer base, the nation is touted to become the world’s second largest oil demand growth centre, after the US. The prediction comes on the back of India contributing 14 per cent of the global oil demand growth in 2018, or to the tune of 245,000 barrels per day. WoodMac estimates demand to rise at same rate in 2019 which will take it ahead of China. It added that transport fuels, or gasoline and diesel, and residential LPG will continue to be the two main drivers of oil demand growth.
India, the third largest oil market in the world, reportedly consumed 206.2 million tonnes, or around 4 million barrels per day, of petroleum products during fiscal 2017-18, as per the US Energy Information Administration. During the first three quarters of 2018-19, consumption was reported at 157.4 million tonnes, after a rise of 2.5 per cent from previous year. Meanwhile, India is expected to represent around 40 per cent of the total rise in global oil consumption by 2040, by when India’s oil consumption is supposed to reach 5.8 million barrels per day, as per Organization of the Petroleum Exporting Countries (OPEC). To cater to this growth, the Government has efforted to raise India’s domestic oil and gas output.
With the aim of cutting India’s oil import by 10 per cent by 2022, the Government has sought to boost investment in the space through policy amendments and liberalisations. India holds estimated oil and gas deposit of 28 trillion tonnes, of which 60 per cent is yet to be harnessed. While India’s proven oil reserves stand at 635 million tonnes, proven gas deposits and estimated shale gas reserves are recorded at 54 trillion cu ft and 96 trillion cu ft, respectively. The Government has been aiming to attract private and foreign technology and investment in developing the space. Since 2000, more than 250 blocks have been alloted to bidders. The government has sought to to “reform, perform and transform’ the sector.