India Petrol Diesel Exports: Amid the US-Iran war, India’s diesel exports see a huge jump of 20%; Petrol prices fall by 33% – The Times of India

Impact of US-Iran war: Indian diesel prices rose 20% in March amid the ongoing Middle East conflict. A widening gap between crude oil prices and refined diesel prices led India to raise diesel imports by nearly 20% month-on-month in March, even as shipments of refined products fell 8%, according to export data.Refiners often adjust their mix to take advantage of fine cracks and edges. Crack spread refers to the price difference between crude oil and the refined products derived from it, while margins represent the profit that refiners receive after accounting for costs and operational efficiency.Although prices have increased during the closure of the Strait of Hormuz, the effect is different depending on the fuel. Crack spreads for diesel and jet fuel rose to new highs, while gasoline spreads remained broadly stable.

Diesel Exports Grow Amid Middle East Conflict

Data from ship-tracking firm Kpler showed diesel shipments totaled 12.90 million barrels between March 1 and March 28, compared with 10.74 million barrels in March.“Higher diesel export levels are likely to be supported by improved economics for middle distillate production. Political tensions in West Asia have tightened middle distillate levels, and diesel and jet fuel cracks are stronger than gasoline (gasoline),” Nikhil Dubey, senior research analyst at Kpler told ET.Also Read | LPG crisis eases: Operations are returning to normal at many plants as commercial LPG supply improves; the workers return“Political conflicts in West Asia have tightened the middle distillate balances, and cracks in diesel and jet fuel are stronger than gasoline (gasoline),” Dubey added.Refiners continue to renew their product portfolio to take advantage of strong expansion and profitability.Despite the sharp increase in crude oil prices caused by the recent closure of the Strait of Hormuz, the effect has not been the same for refined oil. Yields, measured in crack spreads, are higher for diesel and jet fuel, while gasoline remains within normal levels.India’s crude inventories fell sharply in March, falling 33% to 8.31 million barrels. According to Dubey, the drop in petroleum exports is also linked to a policy shift towards higher LPG flows, where refiners are diverting certain hydrocarbon streams from petroleum production and turning them into liquid petroleum gas instead.Domestic production of LPG has increased dramatically, rising by 40% since the start of the US-Israel conflict with Iran. The increase is aimed at eliminating the supply bottleneck from the Gulf region, which previously accounted for 54% of India’s LPG consumption.On the other hand, jet fuel exports fell 4% to 2.63 million barrels in March, as the global fuel limit reached record levels. However, this number is likely to be revised higher once full export data is available, as shipments under the broader ‘clean products’ category rose 40% to 1.11 million barrels. This category includes jet fuel, naphtha, gasoline and diesel, and is used when material details are not immediately specified.Also Read | Impact of US-Iran war: India’s imports from Russia are at an all-time high; will such high numbers continue?To ensure adequate domestic supply, India has imposed import tariffs of Rs 21.5 per liter on diesel and Rs 29.5 per liter on jet fuel, discouraging imports by private refiners. Among exporters, Reliance Industries accounted for nearly 75% of the country’s total exports during the month.Meanwhile, exports of fuel oil, commonly used in industrial and marine applications, rose 27% to 1.71 million barrels as demand improved and networks strengthened. On the other hand, naphtha exports fell sharply by 44% to 2.93 million barrels.Overall, India’s total inventory of refined petroleum products fell to 31 million barrels in March, from 33.67 million barrels recorded in February.