Indian refinery runs fall in May as Covid worsens

India's Covid-19 outbreak is continuing to affect the country's refinery operations as state-controlled oil firms adjust to falling demand and labour shortages.

Bharat Petroleum (BPCL) has reduced throughput at its 240,000 b/d Mumbai and 310,000 b/d Kochi refineries this month. Runs have been cut by the equivalent of a Suezmax vessel, one company official said, implying a reduction of up to 1mn bl or 30,000 b/d over the space of a month.

Throughputs may be cut further in May and June, with the picture likely to become clearer in another week, the official said. BPCL may slow its crude purchases for July arrival as a result, and could offset the fall in domestic demand by exporting gasoline, he added.

India's diesel demand is likely to have fallen by around 15pc in April after Covid-19 cases surged, according to company estimates. The country reported 414,000 new coronavirus cases yesterday, another record high, taking the total to around 21.5mn.

BPCL was forced to postpone a planned turnaround in April because lockdown restrictions in Mumbai meant workers could not gather to carry out the maintenance. The work may now happen in September, company officials said.

Fellow refiner Hindustan Petroleum (HPCL) now plans to restart the No.1 crude distillation unit (CDU) at its 150,000 b/d Mumbai refinery this weekend, rather than 1 May as originally planned.

The company went ahead with a planned maintenance shutdown at the refinery in May but was forced to push back the restart because of labour issues. The restart could still be further delayed, company officials said.