India’s oil demand is projected to increase to 5.4 million barrels per day (mb/d) driven by growth in manufacturing activities and a rise in air travel. The expected surge in demand reflects the country’s recovering economy and the gradual easing of COVID-19 restrictions.
The manufacturing sector plays a crucial role in driving oil consumption in India. As industrial activities rebound and production levels increase, the demand for transportation fuels, petrochemicals, and lubricants is expected to rise. Manufacturing sectors such as automobiles, textiles, and machinery require substantial quantities of oil-based inputs, further contributing to the overall oil demand.
Additionally, the revival of air travel is anticipated to contribute significantly to India’s oil consumption. With the resumption of domestic and international flights, the aviation sector is expected to witness a surge in passenger traffic. Increased air travel translates into higher demand for jet fuel, which is a key driver of oil consumption in the transportation sector.
The projected growth in India’s oil demand aligns with the country’s ambition to achieve higher economic growth and energy security. As one of the world’s fastest-growing economies, India is making efforts to strengthen its industrial base and enhance its infrastructure. These developments, coupled with a growing middle class and rising disposable incomes, are expected to drive consumer spending and subsequently boost oil consumption.
However, it is important to note that India’s oil demand projections may be subject to various factors, including global oil price fluctuations, government policies, energy efficiency measures, and the pace of adoption of alternative energy sources. Additionally, uncertainties surrounding the COVID-19 pandemic and its impact on economic recovery and travel patterns could influence oil demand trends.
To meet the increasing oil demand, India will continue to rely on a combination of domestic production and imports. The country has been making efforts to diversify its sources of oil imports and secure long-term contracts with major oil-producing nations.
As India’s oil demand grows, the government and industry stakeholders are also focusing on promoting cleaner and more sustainable energy alternatives. Initiatives such as the expansion of renewable energy capacity, adoption of electric vehicles, and improvements in energy efficiency aim to reduce the country’s reliance on fossil fuels and mitigate the environmental impact of increased oil consumption.
