Nearly 70% of global oil demand growth between 2010 and 2040 is projected to come from emerging economies, of which the two largest are China and India. Demand growth from these two countries alone is greater than combined demand growth from the rest of the world.
Now India has passed Japan to become the world’s third largest oil importer behind the United States and China. Not only that, India’s oil use rose by 300,000 barrels a day in April, putting the South Asian country in position to surpass China’s estimated demand growth in 2015 of 295,000 barrels a day.
More of India’s oil is coming from the Middle East as well. Iran shipped 160,000 barrels a day to India in the first four months of this year, and Iraq shipped an average of 555,000 barrels a day in the same period. Saudi Arabian exports to India totaled about 795,000 barrels a day in the January through April period.
These three countries account for more than a third of India’s projected 2015 oil consumption total of 4.1 million barrels a day. Japan’s total for the year is now estimated at 3.8 million barrels a day.
India and Japan have routinely traded the third and fourth spot in the global oil import rankings over the past few years, according to a report at Oilprice.com. India, however, is destined to take the lead for good, not just because its population is so much larger than Japan’s, but also because Japanese demand for crude will slow once the country gets its nuclear power generation fleet operating again.
India also is expanding its refining capacity to meet demand for more motor fuels as the country’s growth climbs at an annual rate of 7% and new car sales rise even faster. The world’s largest oil refinery at Jamnagar is getting a capacity increase that will raise its total capacity to more than 1.5 million barrels a day, still less than a quarter of the expected demand for 6.2 million barrels of fuel daily by the end of the decade.