India’s Petroleum Exports to EU

What is in the News ?

• India’s petroleum product exports to the European Union (EU) have grown notably over the past few months as the region weans itself off refined products from Russia, due to the war in Ukraine.

State of India’s Energy Exports to EU

• India is a major refiner with an annual refining capacity of about 250 million tonnes.
• While it is also one of the top consumers of crude oil, India’s refining capacity is higher than its domestic demand.
• India’s petroleum product exports to the EU rose 20.4% year on year in April-January to 6 million tonnes, with the region climbing to the top 20 regions importing refined products from India.
• According to the Directorate General of Commercial Intelligence and Statistics (DGCIS) data, Indian refiners (particularly private) are rushing to partly fill the supply gap for the region.
• From the global oil markets perspective, suppliers like India are helping maintain a demand-supply balance, while preventing extreme price shocks.

Win – Win Situation

• Benefits for India :
  • Indian refiners, particularly export-oriented private sector players, stand to gain (purchase Russian oil at a discount).
  • India now finds itself playing an increasingly prominent role in the global crude oil and refined products supply map.
• Benefits for West :
  • While the West was irked at India’s rising purchases of Russian oil, countries like the US are comfortable with the rising supply of Indian refined products to the EU.
  • They see it as critical for the success of the price caps on Russian oil and refined products (imposed by G7 countries) without causing a global supply shock.

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