First published on 22 July, this data review was updated on 23 July after new data was released.
Indian oil demand fell y/y for the second straight month, by 79 thousand b/d to below 4.6 mb/d in June (May demand was revised down to show a y/y dip of 72 thousand b/d). The weakness was driven yet again by ‘other oils’ and bitumen, with the latter down 11% y/y, partly driven by reduced construction work due to the heatwave and reduced demand from Nayara Energy’s refinery due to coker issues. LPG demand fell y/y by 7%, the first y/y decline since for six years, as restocking demand slumped after Indian federal elections. Gasoline demand growth continued, rising by 73 thousand b/d y/y, despite weak passenger vehicle sales (-17.5% y/y) weighing. The shift to BS-VI fuel standards might help reduce consumer/dealer confusion on the use and resale of BS-V cars and support demand. Diesel demand rose y/y by just 15 thousand b/d, with weak commercial vehicle sales and less construction weighing (cement sales fell by 4% y/y in Q2 19). But low water reservoir levels (59 reservoirs have storage levels well below the average) and the infrastructure-focussed federal budget will help boost diesel demand, though weak economic growth will cap the upside. The latest budget has set a target for building 19.5 million state-funded houses by 2022 and upgrading 125,000 km of roads in the next five years.
Refinery runs fell by 0.14 mb/d m/m in June to a 14-month low 4.96 mb/d (-0.38 mb/d y/y) as a result of throughputs halving at BPCL’s Mumbai refinery. Additionally, runs at the Jamnagar refinery declined m/m by 0.1 mb/d due to planned works, which are continuing in July. But with crude imports plummeting to a two-year low of 4.1 mb/d, crude stocks drew by 0.18 mb/d