India, China to propel global oil demand in 2017, OPEC says

New Delhi: India and China will propel demand for crude oil in 2017, the OPEC said on Tuesday even as it forecast subdued global demand.

World oil demand will grow 1.26 million barrels per day or 1.26% in 2017 from 1.38 mb/d in 2016, OPEC said in its monthly report.

In 2017, world oil demand is expected to stand at 96.31 mb/d, showing a growth of 1.26 mb/d, higher by about 70,000 b/d from previous month’s projections.

“Most of the oil demand growth is anticipated to originate from Other Asia, led by India, followed by China, then OECD America. The OECD Asia Pacific is the only region anticipated to reduce its oil requirements in 2017 y-o-y,” it said.

Indian economy is expected to gather momentum in 2017-18 and grow by as much as 7.5%, according to the government’s Economic Survey. India’s stats office estimated the GDP growth to slow to 7.1% in 2016-17, from 7.9% in 2015-16, as demonetisation crimped consumption and investment demand.

India’s oil demand is estimated to grow by 0.14 mb/d or 3.25% to 4.53 mb/d in 2017, after growing 8.2% in 2016.

In case of China, the oil demand is estimated to grow by 0.28 mb/d or 2.45% to 11.79 mb/d.

In January, India’s crude imports dropped by 132,000 b/d, or 3%, from the previous month to average 4.1 mb/d, showing an annual drop of 161,000 b/d, or 4%.

On the product side, India’s imports in January went down by 66,000 b/d, or 8%, m-o-m to average 777,000 b/d. The imports were down by 13,000 b/d, or 2% year-on-year. The drop seen in the monthly product imports came mainly as a result of lower imports of LPG.

India’s fuel product exports dropped in January by 34,000 b/d, or 3%, to average 3 mb/d. The exports were down by 113,000 b/d, or 8% from last year. “The drop in the monthly product exports came mainly as a result of lower diesel exports,” OPEC said.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.