India's 2021 crude imports rise on higher 2H fuel use

India's crude oil imports in 2021 increased as refiners operated at higher capacity to meet growing fuel demand following the easing of lockdowns in the second half of last year.

Crude and condensate imports of 4.02mn b/d in 2021 exceeded 3.81mn b/d in 2020, preliminary data from Vortexa showed. But ship-ins of 4.16mn b/d last month were mostly unchanged from November.

Refiners were operating at near capacity during the wake of the new lockdown imposed to curb the second wave of the Covid-19, while they started to reduce runs in May. The refiners began to slowly increase runs from June and are operating at maximum or higher capacity .

Transport fuel demand was mixed for the most part of the first half of 2021, while it slumped during the new lockdown . Gasoline consumption was the first to recover following the easing of restrictions and rose to consistently hold above pre-pandemic levels during the second half of last year as preference for personal vehicles over public transport increased.

Jet fuel demand started to recover on the month and an annual basis from July as domestic air traffic increased even as stringent air travel regulations persisted, but it is still holding below pre-pandemic levels. The first wave of the pandemic had brought the aviation industry to a standstill in 2020.

Demand for diesel, which accounts for over 40pc of the country's fuel mix, was still subdued due to lower preference for public transports such as buses, which run on gasoil, while use of trucks and heavy motor vehicles also decreased. Consumption rose above pre-pandemic level for the first time and the only time last year in October due to a short-lived festival-induced demand for goods.

Market participants close to Indian refiners had told Argus that refineries preferred lighter crude grades to increase gasoline production, to meet rising demand.

India imports nearly 84pc of its crude needs, most of which comes from the Middle East.

Middle Eastern crude accounted for about 61pc of the overall crude imports last year or 2.45mn b/d, compared to 62pc in 2020 or 2.37mn b/d, data from Vortexa showed. Its share was 65pc last month, or 2.72mn b/d.

Crude from Africa accounted for about 15pc [583,000 b/d] of the overall ship-ins in 2021, up from about 14pc [523,000] in 2020, while it stood 12pc [467,000 b/d] last month.

"Indian charterers have been quite active over the past few weeks and the trend is continuing," a Delhi-based shipping broker had told Argus . There has been an increase in imports of Middle Eastern crudes, while market participants also said that there has been a rise in shipments from the US.

Imports from the Americas rose to 736,000 b/d last year from 653,000 in the year prior. For December, it was 783,000 b/d, the data showed.

The most imported crude grade last year was Iraqi Basrah Heavy at 380,000 b/d, closely followed by Basrah light at 360,000 b/d. Saudi Arabia's Arab Extra Light was the third most imported grade at 272,000 b/d.

Basrah light was the most shipped-in crude grade last month, followed by Arab light, the data showed.

By Sathya Narayanan

Crude imports by Indian ports mn b/d Dec-21 Nov-21 2021 2020 Sikka 1.2 1.4 1.3 1.2 Vadinar 0.8 0.8 0.8 0.7 Paradip 0.6 0.5 0.6 0.5 Mundra 0.4 0.3 0.3 0.3 Kochi 0.3 0.4 0.3 0.3 Mumbai 0.3 0.4 0.3 0.3 New Mangalore 0.2 0.2 0.2 0.2 Chennai 0.1 0.2 0.1 0.1 Visakhapatnam 0.1 0.2 0.1 0.2 Source: Vortexa India&#39;s crude import from major regions mn b/d Dec-21 Nov-21 2021 2020 Middle East 2.7 2.9 2.4 2.4 Africa 0.5 0.5 0.6 0.5 Americas 0.8 0.7 0.7 0.7 Russia 0.1 0.0 0.1 0.1 Asia 0.0 0.0 0.1 0.1 Other 0.0 0.0 0.1 0.0 Total 4.2 4.2 4.0 3.8 Source: Vortexa Note: Total may not tally due to rounding of numbers

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