India’s demand for oil has remained strong, driven by its growing industrial sector and a surge in transportation and petrochemical needs. The country’s oil consumption, which is expected to increase by 200,000 bpd in 2024, is reflective of its broader economic growth and an expanding middle class. This marks a stark contrast to China, where oil demand has faltered. For several months, China has experienced a downturn in oil consumption, attributed to its slowing economic activity and efforts to reduce dependency on fossil fuels. Its oil demand is forecasted to grow by only 180,000 bpd in 2024, a significant drop from the previous year.
The slowdown in China, compounded by the increasing use of electric vehicles and a shift toward more energy-efficient transport systems like high-speed rail, has prompted a revision of global demand forecasts. While India’s demand has shown resilience, the global growth in oil consumption has been sluggish overall. Most advanced economies, including the United States and Europe, have also faced weak oil demand, reflecting the challenges of post-pandemic recovery and economic restructuring.
India's rising influence in the oil market is not limited to consumption. The country has emerged as a major buyer of Russian oil, overtaking China as the top importer. This shift is part of a broader trend where India’s oil needs are met predominantly through imports, with more than 80% of its oil coming from abroad. As the world's third-largest oil importer, India’s position in the global energy market continues to strengthen, prompting calls for OPEC and its allies, including Russia, to adjust production levels to meet rising demand.