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Indian oil and gas demand plummets 70%
PERFORMANCE
INDIAN Minister of Petroleum and Natural Gas Dharmendra Pradhan said this week that the coun- try’s energy demand had fallen by 70% since the nationwide lockdown began on March 24.
But with demand having fallen the country has capitalised on low oil and gas supplies to stock up on oil products, the official said during a social media conference on May 4.
“India has also seen almost 70% decline in oil and gas demand. The oil and gas sector is going through unprecedented challenges. Despite challenges, our refineries are operating, [the] supply chain [is] working. India has been able to fill its strategic reserves of petroleum products,” he said.
Pradhan added that the country’s state majors had bought 7mn tonnes (51.31mn barrels) of oil at “low prices”. He said: “almost 20% of our demand has been stored. This has also led to [a] reduced import bill, which will help us free more resources for public welfare measures.”
India extended its lockdown for the second time on May 1, setting a new deadline of May 18 before social distancing measures can be lifted. The country had originally aimed to lift the lock- down on April 14, but this was postponed until May 4.
The country’s imports of crude rose by just 1.8% year on year in March to 19.52mn tonnes (4.62mn barrels per day (bpd)), according to Petroleum Planning and Analysis Cell (PPAC) data published on May 1. Oil product imports expanded more than 7% y/y to 3.92mn tonnes, while exports climbed by 7.4% on the year to 5.93mn tonnes.
Diesel exports climbed by 11.7% y/y, the slowest rate since August, while gasoline ship- ments declined by 5.2%. Overseas demand for fuel has shrunk as other countries have imposed social quarantine measures, with energy consul- tancy Rystad Energy projecting that the coro- navirus (COVID-19) pandemic will cut global diesel demand by around 5.2mn bpd in the sec- ond quarter.
India’s refinery runs shrank by 5.7% on the year in March to 21.2mn tonnes, producing 22.9mn tonnes of oil products.™
Pakistani fuel shortages loom
PERFORMANCE
PAKISTAN could run out of oil products within the next few weeks owing to govern- ment agencies’ inability to work together to resolve a supply shortfall, local daily The News reported on May 5.
The paper quoted unnamed industry sources as saying there could be a dearth of diesel and gasoline within the second half of May as a result of supply chain disruptions.
The Pakistani Energy Ministry ordered oil marketing companies (OMCs) in March to halt imports to comply with the coronavirus (COVID-19) lockdown. The ministry on April 25 allowed the companies to resume imports, noting that demand had risen owing to the start of the country’s harvest season.
“To meet the rising demand, refineries may import crude oil as per their requirement,” the energy ministry said at the time.
While the ministry has said previously that the country has enough stored oil prod- ucts to last until May 15, one of The News’ sources said the ministry had not lifted the embargo in time for enough fuel to be imported in April and May, and that approv- als for June were still pending.
Noting that the government had only approved limited quantities in April and May, the source added: “This has raised the fears of possible dry-out in the country if the supply chain planning is not improved immediately.”
Byco Petroleum Pakistan and National Refin- ery halted operations at their respective 155,000 barrel per day and 64,000 bpd refineries in March, while Attock Refinery Ltd (ARL) said on March 19 that it would close its second 5,000 bpd crude distillation unit (CDU) owing to reduced OMC offtake volumes.
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