India’s 2022 oil demand to exceed pre-pandemic levels : OPEC

Demand to pickup by 8% to 5.34 mb/d

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Biznextindia : In 2022 India’s oil demand to increase by 0.39 mb/d or 7.86% to 5.34 million barrels per day (mb/d) to exceed pre-pandemic levels, but uncertainty remains high due to new COVID-19 variants, the Organization of Petroleum Exporting Countries (OPEC) has estimated.

“In 2022, oil demand is anticipated to increase by around 0.4 mb/d, with total volumes expected to exceed pre-pandemic levels on an annualized basis. COVID-19 containment measures are anticipated be sustained by an increase in vaccination, natural immunization and improved management of the virus. Regarding products, gasoline is anticipated to be the strongest product in 2022, supported by an acceleration in mobility, uptick in vehicle sales and overall steady economic development. Diesel is assumed to be supported by healthy industrial, construction and agriculture activities in 2022” OPEC said in its October edition of monthly oil market report.

In the remaining months of 2021, OPEC said, India’s oil demand should pick up after the monsoon season, the festive season and improving industrial activity.

“Going forward, India’s oil demand should continue to pick up pace after the monsoon season with the festive season, as well as improving industrial activity providing consumption support for the reminder of the year. However, uncertainty will remain high, largely associated with new COVID-19 variants, in addition to the pace of vaccination rollout programmes. Similarly, high retail prices and government reaction to those prices are to be closely monitored in the coming months. That said, oil demand is anticipated to pick up pace over the short term, encouraged by a low baseline and a rise in transportation and industrial fuel demand. The transportation fuel recovery is estimated to continue going forward, supported by better management of the COVID-19 pandemic. As a result, transportation fuel demand is projected to lead product demand, followed by middle distillates” the report read.

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