Petroleum product exports shrink 14% in August as global demand cools

The continuing decline in the export of refined petroleum products widened in August to 5 million tonnes (mt), according to the latest data from the Petroleum Planning and Analysis Cell.

Exports in this category have decreased by nearly 3 per cent to 18.1 mt in the first five months of 2024-25, largely due to sluggish diesel exports.

Imports of crude oil increased by 6.4 per cent in August, rising to 19.9 mt from 18.7 mt in August 2023, indicating no supply-side shortages.

Conversely, the consumption of petroleum products fell by 2.65 per cent in the latest month to 18.3 mt, suggesting that inventories were not diverted to the domestic market. Sales of diesel, the most-used fuel in the country, fell by 2.5 per cent to 6.5 mt in August.

As a result, sagging exports are attributed to a loss of demand in European markets, according to industry insiders.

Last week, benchmark Brent crude futures prices fell to a 33-month low of $69 per barrel due to weak demand and concerns about oversupply.

Despite ongoing production cuts by the Organization of the Petroleum Exporting Countries bloc, supplies have continued to rise. Last week, the International Energy Agency reported that global oil supply increased by 80,000 barrels per day (b/d) to 103.5 million b/d in August, with outages caused by political disputes in Libya and maintenance in Norway and Kazakhstan offset by higher flows from Guyana, Brazil, and elsewhere.