India, one of the world’s fastest-growing oil markets, has lagged behind major economic peers in Europe and Asia in EV adoption, but sales are now rising and investment in new auto and energy infrastructure production is ramping up. Has been
Some analysts and industry participants say the faster-than-expected industry growth means India’s gasoline consumption will peak sooner than previously thought, prompting top oil companies to look to alternate business lines, especially petrochemical manufacturing. Will be forced to bring
Debasish Mishra, partner, energy, resources and industries, Deloitte India, told Reuters. He expects the demand for diesel to be at its peak just like petrol.
An industry source at an India-based refinery told Reuters that the slow fuel demand will be seen largely through 2030 due to EV technologies stabilizing compared to the earlier projection of 2040, adding that the heavy trucking sector will recover slightly later. Changes will be visible later.
“Refiners are already investing in petrochemical integration to cope with the potential loss in fuel demand,” said the source, who declined to be named because he is not authorized to speak to the media.
Currently, about 90% of Indian petrochemical demand is met by China, he said, so a shift by Indian refiners to domestic chemical needs could dramatically change supply dynamics.
Indian refiners are investing billions of dollars to increase petrochemical capacity. The country’s top refiner Indian Oil Corp is expanding petrochemical capacity at its Panipat refinery by 13% and building new plants attached to its Paradip and Gujarat refineries.
Reliance Industries Ltd., operator of the world’s largest refining complex, plans to invest 750 billion rupees ($9.38 billion) to expand its chemicals business, while Essar Group plans to build a 400 billion rupee petrochemical complex in eastern India. is planned to be installed.
Nayara Energy expects to commission 15-20 new integrated petrochemical plants over the next decade.
EVs, Trucks
China currently dominates global EV production and domestic adoption of new energy vehicles is well advanced. The China Passenger Car Association expects sales of new energy cars, mainly EVs, to reach 8.5 million units, or 36% of all new sales, this year.
Despite the new momentum in India, the question for the country is whether this will eventually be enough to eliminate its fossil fuel dependence.
“Limited charging infrastructure, low domestic EV production and high EV battery costs are some of the major barriers to sustaining strong EV adoption over the long term,” said Dylan Sim, oil market analyst at FGE.
India’s progress is modest in global comparison, however, with EVs registered last year increasing three-fold to 1.01 million by 2021, most of which are two-wheelers and three-wheelers.
While EVs account for just 1% of the 3 million cars sold each year, New Delhi wants to increase that to 30% by 2030 and has introduced a range of policies to get there, including tax breaks for consumers.
India’s state refiners, which dominate fuel retailers, plan to install EV charging facilities at over 22,000 fuel stations and along highways by 2024.
The private sector is also offering EV bulls hope.
Gurugram-headquartered ride-hailing service BlueSmart, which has a fleet of 3,000 EVs, has seen rapid growth.
Its co-founder Puneet Goyal told Reuters it now provides 500,000 monthly trips, up from about 35,000 when it launched in 2019.
Local automakers like Tata Motors and Mahindra & Mahindra have made big investments while foreign players like Kia and BYD have announced premium models for the Indian market.
About 40% of India’s fuel demand is for diesel, which is mostly used by trucks.
Chetan Maini, chairman of Sun Mobility, which provides electric mobility solutions, said India’s transition to small trucks, including three-wheelers, is likely to see early adoption given the cost advantages for e-commerce and delivery firms. Is.
His company currently has 80 battery swapping stations in Delhi for two-wheelers and three-wheelers and plans to set up 200 by March.
“A huge opportunity is going to be on the trucking side by 2030 because the cost economics will work out really well,” Maini said.
The text of this story is published from a wire agency feed without any modification.
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