New Delhi: India's domestic demand for oil is expected to increase at a CAGR (compound annual growth rate) of 4 percent over the next decade, S&P Global Commodity Insights, a division of S&P Global, said on Wednesday. In 2025 so far, oil consumption in India stands at 4.8 million barrel per day (MBPD), up 4.3 percent from the previous calender year. The country's crude oil demand is 5.4 MBPD this year.
The global oil prices have lost some shine in 2025 year-to-date on the back of a challenging demand environment exacerbated by supply growth from OPEC+ as well as beyond, Pulkit Agarwal, Head of India Content (Cross Commodities), said.
"For India, oil demand continues to grow, helped by favourable demographics and economic growth. India is quickly assuming a prominent place in the global oil demand growth order, while the base is still small to have an oversized implication on the global markets," he said. The oil demand is expected to continue to grow at a CAGR of 4 percent for a decade, Agarwal said.
India's choice of oil sources continues to evolve as India's pivot to Russia continues largely unhindered in the fourth year of their meaningful initiation, Agarwal said.
Speaking on renewable petrochemicals, Stuti Chawla, Associate Director, India and Middle East Chemicals Pricing, said India's petrochemical demand is likely to outpace GDP growth in 2025-26 (Apr-Mar), despite concerns over a drop in urban demand and inventory build-up seen in the domestic markets amid tariff concerns.
In a world plagued with slowing consumer demand, uncertainty over tariffs, tighter margins and over-capacity, global petrochemical producers are betting on India as a key demand driver in 2025, she said.
Gauri Jauhar, Executive Director, Energy Transition & Cleantech Consulting, who spoke on clean energy, said achieving net zero carbon emission, energy transition targets across multiple technology options will require connecting the dots of policy, regulatory and corporate action with a push for greater consistency.
When asked about challenges expected in India's clean energy journey, Agarwal said for any kind of transition the cost of green energy is, of course, a big major factor which determines how fast the transition happens.
"But, when we talk about transition and when we talk about any kind of transition, the older form of energy is almost never phased out. Remember, the world transition from coal to oil doesn't mean that the world does not consume coal. The world today is consuming more coal than probably it ever did," he said.