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India’s petroleum product exports in October fell to a six-month low as a consequence of maintenance-related dip in production as some of the country’s major refineries, particularly Reliance Industries Ltd’s (RIL’s) Jamnagar refinery complex, as per an analysis of provisional export data from commodity market analytics and intelligence firm Kpler. The recovery in domestic fuel and petroleum product demand following the monsoon-related slump is also likely to have impacted exports.
As of October 29, India’s petroleum product exports in October stood at 1.15 million barrels per day (million bpd), the lowest since April’s 1.04 million bpd, as per Kpler data. October petroleum product exports were down nearly 4 per cent from September levels and around 20 per cent from August volumes.
It is worth noting that October saw partial maintenance shutdowns at RIL’s Jamanagar complex, the world’s largest single-location refinery complex with a cumulative crude oil processing capacity of around 1.4 million bpd, and Bharat Petroleum Corporation Ltd’s (BPCL’s) Mumbai refinery. Indian Oil Corporation Ltd’s (IOC’s) Paradip refinery had a complete shutdown for around 10 days this month.
Private sector giant RIL accounts for a major chunk of India’s fuel and petroleum product exports, while public sector players like IOC and BPCL are only marginal exporters with most of their production being consumed within India. India is the world’s third-largest consumer of crude oil and depends on oil imports to meet over 85 per cent of its domestic demand. However, with its refining capacity of around 254 million tonnes per annum (mtpa), or around 5 million bpd, being lower than its domestic demand, the country is a net exporter of petroleum products.
According to Kpler’s estimates, RIL’s petroleum product exports in October were less than 800,000 bpd, the lowest in 12 months. Over the past year, RIL’s share in India’s petroleum product exports has averaged at close to 72 per cent, as per the data. In October, the company’s share in the country’s petroleum product exports is estimated at around 69 per cent. It is worth noting that an export-oriented refinery accounts for a little more than half of the refining capacity at RIL’s Jamnagar complex.
The export volumes of public sector refiners declined to the lowest in four months as domestic demand for fuels and other petroleum products recovered from the annual monsoon-related dip. Over the three to four months that preceded October, exports by domestic market-oriented public sector refiners had seen an uptick as domestic demand was dampened by the southwest monsoon rains. Diverting some of the domestic volumes to the export market allowed Indian refiners to maintain high refinery runs.
With the refinery maintenance season now at its fag end, India’s petroleum product exports are seen rebounding in November, according Kpler’s lead crude analyst Viktor Katona. However, high domestic demand during the festival season could cap exports, particularly for public sector refiners and fuel retailers IOC, BPCL, and Hindustan Petroleum Corporation Ltd (HPCL). As per Katona’s estimates, the two RIL refineries and IOC’s Paradip refinery should be operating at their full capacity in November. BPCL’s Mumbai refinery is expected to come to full capacity in first week of November.
