Photo caption: A Hindustan Petroleum Corp. oil refinery in Mumbai, India, on Monday, Aug. 11, 2025. India’s state-owned oil refiners are pulling back from purchases of Russian crude for now, according to people with direct knowledge of the companies’ procurement plans, as Washington ratchets up the pressure on New Delhi over the flows with a wave of harsh tariffs. Photographer: Abeer Khan/Bloomberg
Oil demand growth in India looks set to outpace China’s underlying gains this year, according to Trafigura Group.
“We would be constructive on Indian demand,” Chief Economist Saad Rahim said at APPEC by S&P Global Commodity Insights on Monday. “This year, Indian demand is set to outstrip China’s, if you exclude strategic stockpiling.”
China and India — the region’s leading crude importers — are key drivers of demand growth, as producers and traders navigate the impact of economic shifts, plus the spread of renewable energy. While growth in the South Asian nation is being driven by urbanization and rising incomes, China is facing slowing crude consumption growth aside from in petrochemicals.
Still, overall consumption growth in China this year has been supported by consistent builds in stockpiles, both commercial and strategic. That accumulation has helped to support global crude prices even as OPEC+ restored idled capacity at a rapid clip, including an additional loosening at the weekend.
The stockpiling of roughly 200,000 barrels a day in recent months has helped to support demand, Frederic Lasserre, global head of research and analysis at Gunvor Group, said on the same panel. The stockpiling is evident in China’s continued imports through refinery-maintenance season, he said.
“Today, China is willing to stockpile and increase their SPRs,” Lasserre said, referring to strategic petroleum reserves. Even so, it’s unlikely that the country can build that over the long term, and it might not be able to absorb all of the impending market surplus, he said.
Going into next year, there are also fewer clear drivers for global demand, Rahim added, even as more supply comes onto the market, making it difficult to see how the extra oil will be soaked up.
“Is there enough demand to absorb this?” he asked. “We’re talking about — next year — just under a million barrels a day of demand growth. Unless you’re talking about double that, just on the demand side, it’s really very hard to see.”
=== Bloomberg ===
