During the India Energy Week, the Paris-based agency released a special report titled “Indian Oil Market Outlook to 2030.” According to the report, India’s oil demand is projected to rise from 5.48 million barrels per day in 2023 to 6.64 million bpd in 2030.
Currently, China holds the title of the largest driver of oil demand, with India ranking second in growth. The IEA noted that India’s growth will surpass that of China in 2027.
IEA Director of Energy Markets and Security, Keisuke Sadamori, stated, “India’s oil demand will grow at a rapid pace by 2030 despite accelerated green energy moves.”
India, being the third-largest consumer of oil globally, imports 85% of its oil needs. Despite efforts to transition to cleaner energy sources, India’s domestic production is expected to fall, leading to increased dependence on imports.
Diesel, constituting about 50% of Indian gains, will play a significant role in global demand growth by 2030. The IEA anticipates that the adoption of electric vehicles (EVs) will primarily occur in two- and three-wheelers, with only around 5% penetration in the four-wheeler segment.
The report suggests that over 500,000 barrels per day of oil demand could be avoided due to increased EV penetration, energy efficiency improvements, and biofuels growth, with approximately 200,000 bpd attributed to EVs.
Refinery expansions are expected to meet domestic needs and maintain India’s position as a key exporter of transportation fuel. India’s energy companies are targeting an additional 1 million barrels per day of refinery capacity.
While acknowledging India’s role in global energy demand growth, the IEA highlighted challenges, including feedstock constraints for ethanol blending in petrol and the potential decline in domestic crude oil production.
In conclusion, the IEA emphasized that India’s transformation into the largest source of global oil demand growth by 2030 is integral to the country’s economic growth, presenting both opportunities and challenges for its energy security.