Indian Energy Demand Driven by Emerging Middle Class
Thursday April 14, 2016
Amrita Sen and Anupama Sen with the Oxford Institute for Energy Studies have published an insightful paper entitled “India’s Oil Demand: On the Verge of ‘Take-Off’”. The authors argue that India could be on the verge of a rapid burst in crude oil demand growth equivalent to what China experienced in the late 1990s.
Crude oil price prognosticators should carefully observe physical Indian crude oil imports and refined product consumption for signs of such a surge.As Mike Rothman with Cornerstone Analytics has astutely observed, China is the only non-OECD country with strategic petroleum reserves, so a sudden increase in Indian apparent demand could signal that the market has underestimated global oil consumption.
India May Surpass Japan in 2016
The International Energy Agency reports that India consumed 4 million barrels of oil per day in 2015 and may surpass Japan as the world’s third-largest oil users this year.
In fact, U.S. crude oil could soon be exported to India.
Indian crude buyers now can use the lifting of the U.S. crude oil export to negotiate transactions bench-marked to WTI, Brent, or Dubai contract prices. For example, Reliance Industries, Ltd, one of the largest crude oil refiners in the world notes it is changing crude oil benchmarks as it makes buying decisions.
India is diversifying not only crude oil benchmarks but also looking to make deals in Russia.
India Is Investing In Roads
India is inv...