Indian oil demand eased m/m to 4.49 mb/d in November, lower y/y by 80 thousand b/d, from an upwardly revised November 2017 figure (by 50 thousand b/d). Diesel (-89 thousand b/d y/y) and LPG (-61 thousand b/d) led the declines. The decline in diesel was a result of tightening lending conditions in the private sector, which has weighed on construction activity, and a slowdown in general sentiment as the Modi government’s policies to support growth have been met with scepticism. LPG demand was the lowest since May 2017, and November marked the first y/y decline since June 2013. Gasoline demand rose to 0.66 mb/d in November, higher y/y by 53 thousand b/d, with growth picking up to a five-month high despite high gasoline prices and waning GDP growth. Jet/kero demand rose m/m to 0.25 mb/d in November, but was flat y/y. Kerosene demand was lower y/y by 9 thousand b/d, with jet up by the same amount. India’s domestic air passenger traffic grew in October by double digits, for the 50th consecutive month. Despite the stellar growth, key airlines are struggling to keep afloat. Fuel oil demand fell to 1.04 mb/d in November, lower y/y by 8 thousand b/d, although port traffic continued to improve.
Indian runs eased slightly m/m in November to 5.16 mb/d, lower y/y by 30 thousand b/d, as planned CDU outages were higher y/y by 55 thousand b/d at 0.20 mb/d, supported by month-long works at Nayara Energy’s 0.43 mb/d Vadinar refinery starting late November, which pushed Vadinar runs down to 0.25 mb/d for the month. December runs are set to be low too. Following record builds in October, crude stocks fell at a record pace in November, by 0.32 mb/d. With heavy maintenance coming up, including at Reliance, imports will remain low in Q1 19.