Oil Demand Epicenter Shifts: India's Massive Growth Set to Rewrite Global Energy Map!

The International Energy Agency (IEA) has identified India as the future epicentre for global oil demand growth over the next ten years. This surge is primarily attributed to India's rapid economic expansion, ongoing industrialisation, and a significant rise in vehicle ownership. The IEA forecasts India's total energy demand to grow at an average annual rate of 3% until 2035, making it the fastest among emerging and developing economies. India is expected to contribute the largest increase in global oil consumption through 2035, surpassing even China and Southeast Asia combined. The country's oil consumption is projected to climb from 5.5 million barrels per day (mbpd) in 2024 to 8 mbpd by 2035, fueled by rising car ownership, demand for plastics and chemicals, aviation fuel, and increased use of LPG for cooking. Nearly half of all additional global oil demand up to 2035 is anticipated to come from India alone.

Import dependence is set to deepen, with India's oil import dependency projected to rise from 87% in 2024 to 92% by 2035. However, India's refining capacity is expected to expand significantly, growing from 6 mbpd in 2024 to 7.5 mbpd by 2035, enabling it to become a major exporter of transport fuels. The report notes India's emergence as a global swing supplier, refining Russian crude oil.

Regarding gas and coal, India's natural gas demand is projected to nearly double to 140 billion cubic metres (bcm) by 2035. Coal production will continue to rise, increasing by around 50 million tonnes of coal equivalent (Mtce) by 2035, which will help limit coal imports. Coal India Ltd's expansion of the Gevra mine is noted.

Beyond oil, India is a major driver of overall global energy demand growth. The country's GDP is expected to grow over 6% annually. India is also rapidly advancing its renewable energy goals, with non-fossil power capacity already exceeding targets and projected to reach 70% by 2035, with solar and wind forming a substantial part of the energy mix. Solar PV has seen substantial investment.

Impact: This news signifies a massive growth opportunity and challenge for India's energy sector, impacting oil and gas producers, refiners, chemical companies, and renewable energy firms. The increased import dependence highlights a potential vulnerability, while expanding refining capacity presents export opportunities. The push for renewables signals a significant transition in the power sector. Rating: 8/10

Difficult terms: IEA (International Energy Agency): An intergovernmental organisation that provides data, analysis, and solutions on energy issues. Epicentre: The central point or hub of an activity or phenomenon. Global Energy Outlook 2025: A report by the IEA forecasting future energy trends and demand. mbpd (million barrels per day): A unit used to measure the volume of oil consumed or produced daily. LPG (Liquefied Petroleum Gas): A flammable gas commonly used as fuel for cooking and heating. bcm (billion cubic metres): A unit used to measure large volumes of natural gas. Mtce (million tonnes of coal equivalent): A unit used to measure the energy content of coal or other fuels. Non-fossil power capacity: Electricity generated from sources that are not fossil fuels, such as solar, wind, hydro, and nuclear power. Solar PV (Photovoltaics): Technology that converts sunlight directly into electricity using semiconductor materials.