India’s oil demand in 2021 to fall below 2019 levels
According to S&P Global Platts, India's oil demand in 2021 is likely to fall below that of 2019. This is due to the second wave of the Covid-19 pandemic, which has resulted in increased lockdowns across multiple states.
According to Kang WU, Director of Global Demand and Asia Analytics, India's oil demand is expected to be 225,000 barrels per day lower in April than it was in March, according to Platts Analytics. Due to more impending restrictions, May is expected to weaken even more, falling by 370,000 barrels per day before improving in June. After a sharp contraction of 470,000 barrels per day last year, the firm has revised down India's oil demand growth for 2021 to 350,000 barrels per day, which is still positive. As a result, oil demand in 2021 is expected to remain lower than it was in 2019.
Oil demand is already outpacing supply and the shortfall is expected to worsen.
Oil prices fell on Thursday, reversing an eight-week high, as fears of the Coronavirus outbreak in India, the world's third-largest crude importer, dampened a rally fueled by IEA and OPEC predictions of strong demand.
After gaining over 1% on Wednesday, Brent crude was down 32 cents, or 0.5%, at $69.00 a barrel by 0145 GMT. After rising 1.2% the previous session, West Texas Intermediate (WTI) was down 31 cents, or 0.5%, to $65.77 a barrel.
The Organisation of Petroleum Exporting Countries (OPEC) recently maintained its forecast for a robust return of global oil demand in 2021, citing growth in China and the United States as cancelling out the impact of India's Coronavirus crisis.