The EIA cut its forecast for Indias oil demand

The rapid increase in COVID-19 cases in India has led to various travel restrictions, reducing the consumption of transport fuels such as petrol diesel. As a result, the EIA lowered its forecast for India's oil consumption in its May Short Term Energy Outlook (STEO), according to Hydrocarbon Processing Network Information.

Between March April, India's oil consumption fell by 400,000 b/d, 8 per cent, to 4.7m b/d, according to EIA estimates.

After the STEO release in May, India's oil consumption data showed a drop of 300,000 b/d (6%) the same period. India's tourism numbers are likely to continue to decline, so it revised down its oil consumption for May June April's STEO data as well. The EIA expects India's consumption of oil other liquids to return to previously projected levels by July.

Data the Petroleum Planning Analysis Group (PPAC) of the Ministry of Petroleum Natural Gas indicate that gasoline diesel consumption returned to pre-epidemic levels in September last year will continue to do so until March 2021. However, gasoline diesel consumption declined in April 2021, reflecting the increase in COV cases the country's response to limit its transmission.

According to real-time liquidity indicators, tourist arrivals India dropped even more by mid-May. The COVID-19 community mobility report provides data on changes in the number of visits by place compared to the baseline of 3 January 2020 solstice 6 February 2020. As of May 21, 2021, tourism to various destinations in India has dropped significantly in the past few weeks, which may reflect the country's response to the epidemic, according to data.

Similarly, according to Google, the percentage of time spent at home increased by 25% in the mid-May 2021 comparison period. The time spent at home in mid-May 2021 is similar to the time spent at home in April 2020, when travel to India also decreased significantly. The drop in mobility in May 2021 is consistent with a significant drop in demand for gasoline diesel, but the extent of the drop will depend on how long these conditions last how rigorous the country's response to the outbreak ultimately becomes.

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Source: International Petroleum Network