Economy News

OPEC noted that in September, India’s oil demand expanded further by 343 thousand barrels per day (tb/d), y-o-y, following an increase of 119 tb/d, y-o-y, seen the previous month. Domestic economic activity is expected to strengthen further, following sound economic growth in the first half of 2025. Strong private consumption and solid expansion in the services sector, driven by policy reforms and government support for key sectors, are expected to provide support.

Accordingly, these factors are expected to bolster steady oil demand in India in the near term. Gasoline is expected to drive demand growth in 2025, and diesel is also expected to show a y-o-y increase. NGLs/LPG demand is predicted to grow, y-o-y, driven mainly by a government incentive programme supporting household LPG requirements for cooking. Jet/kerosene demand is also forecast to expand slightly, y-o-y, supported by international and domestic air travel demand. Meanwhile, residual fuel oil demand is projected to increase marginally. However, demand for naphtha and the ‘other products’ category is projected to decline, y-o-y.

Accordingly, oil product demand in the country is expected to grow by 109 tb/d, y-o-y, in 2025 to average 5.7 mb/d. Ongoing robust economic activity in India is expected to continue into 2026, driven primarily by service sector activities, amid sustained government support in key sectors, increased consumer spending, and easing inflation. In line with these expectations, oil demand is projected to grow by 225 tb/d, y-o-y, to average around 5.9 mb/d.

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