Synopsis
India’s diesel exports saw a significant shift in May. Africa became the primary destination, absorbing over 80% of shipments. This change happened as demand from Asia and Europe weakened. Geopolitical tensions also reshaped global diesel trade flows. Higher refinery operations in Asia reduced import needs. Europe received no diesel, while Asian shipments dropped sharply.
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iStockNew Delhi: More than 80% of India’s diesel exports in May headed to Africa as demand from Asia and Europe weakened and geopolitical tensions reshaped global diesel trade flows.
India exported 394,000 barrels per day (bpd) of diesel in May, compared with 376,000 bpd in April and 399,000 bpd in February, according to energy cargo tracker Kpler. About 327,000 bpd, or 83% of total exports, went to Africa in May, against 32% in April and 64% in February. No diesel was exported to Europe, while shipments to Asia fell 76% to 40,000 bpd in May.
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“This shift (from Asia to Africa) is due to improved refinery runs across the broader Asian region this month, as China’s crude appetite fell to a 10-year low, freeing up crude availability for other Asian refiners,” said Nikhil Dubey, lead analyst – refining at Kpler.
Higher refinery runs reduced the need for imports across Asian economies.
The Iran war, which erupted on February 28, has also reshuffled diesel trade flows. “There is a significant element of trade optimisation following the Middle East conflict and disruptions in the Strait of Hormuz,” Dubey said. “India is increasingly supplying Africa—which previously received products from the Middle East—while Europe is sourcing more from North America.”
The EU’s restrictions on fuels refined from Russian crude have further curtailed India’s exports to the bloc, even as disruptions around the Strait of Hormuz have pushed Indian refiners to rely more heavily on Russian oil. After declining for a few months earlier this year following US sanctions, the share of Russian crude in India’s imports has risen to nearly 40% again. India had been a key supplier of diesel to Europe until the EU banned imports of fuels refined from Russian crude earlier this year.
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India’s overall petrol exports fell 40% month-on-month in May due to healthy domestic demand and lower production. Domestic supply was lower as petrol producing units at refineries operated by Nayara Energy and Reliance Industries underwent maintenance shutdowns, Dubey said.
India exported 173,000 bpd of petrol in May, with 55% going to Asian countries and 20% to Africa. Petrol exports stood at 290,000 bpd in April and 360,000 bpd in February.
Reliance Industries is India’s largest fuel exporter. Nayara Energy also exports significant volumes, while state-run companies occasionally ship cargoes overseas. Fuel exports respond quickly to shifts in regional demand, pricing and trade policies. Indian refiners primarily sell fuels to commodity traders.
