Eco
India is poised to significantly increase its diesel exports next year with the commissioning of new refining capacities, which will help alleviate the global fuel supply shortages affecting markets from the United States to Europe. India's Oil Minister Hardeep Singh Puri stated that state-owned refineries will add an annual diesel production capacity of no less than 15 million tons through a new refinery and expansions of existing facilities. Speaking at a sector conference in Goa, Puri emphasized that India will be well-positioned to refine oil not only to meet domestic demand but also global needs. Diesel supplies have faced major disruptions due to conflicts in the Middle East and the war between Russia and Ukraine, impacting crude oil and fuel flows and driving prices higher worldwide this year. Russia’s halt of diesel exports in July to protect domestic supplies, following attacks on its refineries and ports, further exacerbated the shortage. This shortage pushed U.S. diesel prices to record highs, prompting Washington to consider export restrictions before a deal was reached between the U.S. and Russian presidents to increase fuel supplies to global markets. India has capitalized on these disruptions to become the world’s second-largest diesel exporter this year, surpassing Russia, according to Kpler data. India is already one of the largest global diesel suppliers, a key fuel for agriculture, industry, and heavy transport. Refinery expansions are expected to strengthen India’s market share amid forecasts of continued supply tightness through 2027. Indian Oil Corp’s Chairman Arvinder Singh Sahni announced that the company expects to increase its annual diesel output by up to 9 million tons starting next year after completing expansions that will add over 17 million tons of crude processing capacity across three refineries. Hindustan Petroleum Chairman Vikas Kushal stated the company will add about 4 million tons to its diesel production as its new refinery in Rajasthan, with a capacity of 9 million tons annually, reaches full operation. Numaligarh Refinery, part of Oil India, plans to raise fuel output by around 3 million tons, while Bharat Petroleum expects to add 1.5 million tons from 2028, according to its Chairman Sanjay Khanna. Indian refineries produced 59 million tons of diesel in the first half of the fiscal year starting in April, with domestic consumption at approximately 46 million tons, according to the Ministry of Petroleum. Puri noted that India’s total refining capacity is set to rise to 300 million tons annually from about 267 million tons currently, with projections reaching 400 million tons within a few years. Mukesh Sahdev, founder and CEO of XAnalysts, highlighted that India’s refining capacity will become a significant strategic advantage for the country.
