India set to overtake China as top driver of global oil demand growth

India is usually set to overtake China as the biggest source of growth for oil demand by 2024, according to a forecast announced Monday by research along with also also consultancy group Wood Mackenzie.

The country’s oil demand is usually set to boost by 3.5 billion barrels per day through 2017 to 2035, which will account for a third of global oil demand growth. India’s expanding middle class will be a key factor, as well as its growing need for mobility, according to Wood Mackenzie.

On the different hand, China — currently the second-largest oil consumer from the globe — may soon need less oil. In 2017, of which overtook the U.S. as the biggest importer of crude oil, nevertheless of which’s set to see a decline in oil demand growth through 2024 to 2035, Wood Mackenzie Research Director Sushant Gupta told CNBC.

of which’s due to two trends: Alternative energy sources such as electricity along with also also natural gas are displacing the need for gasoline along with also also diesel. along with also also, a more efficient freight system along with also also truck fleet will also result in sluggish road diesel demand, Gupta said.

For India, as demand grows, an oil shortage is usually already imminent. The country is usually only supposed to add 400,000 barrels per day in firm refinery capacity out to 2023 — paling in comparison to demand growth — warned Wood Mackenzie.

“We think the most likely situation is usually of which India would certainly need between (3.2 million along with also also 4.7 million barrels per day) of brand new capacity out to 2035 to remain self-sufficient in transport fuels. So we are talking about a future capacity which is usually 1.7 to 2.0 times the current. This specific is usually clearly an uphill task, unless domestic refiners can commit to their planned capacity additions,” Gupta said in a Wood Mackenzie Discharge accompanying the India demand projection.

With India’s refinery yields still highly tilted toward diesel, Wood Mackenzie added of which India needs to start focusing on increasing gasoline. However, having a global surplus of gasoline expected from the long run, India could consider importing the fuel, the research firm suggested.

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