MOSCOW (MRC) -- Indian refiners' crude throughput slipped to its lowest level in seven months in May as a raging second wave of coronavirus drove a slump in domestic fuel demand and crude imports, government data showed, said Hydrocarbonprocessing.
Refiners processed about 4.5 million barrels per day (bpd) or 18.97 million tonnes of oil last month, data from the country's Ministry of Petroleum and Natural Gas showed. That was 7.7% below April levels but still 16% higher than a year earlier.
"We're expecting to see runs dip in June before ramping up towards the end of the year on a combination of seasonal demand strength post-monsoon and recovery from the impact of the second wave of the pandemic," Natixis commodities strategist Joel Hancock said. The dip in refinery processing comes on the back of a 5.5% slip in India's crude oil imports from April and May's fuel demand in the third biggest oil consumer slumping to its lowest since August last year.
Demand bottomed in May and will be ramping up steadily through the second half of this year and will rise sharply in the last quarter, Hancock said. Analysts noted that refiners remain optimistic over a rebound in oil demand as vaccinations have ticked up and COVID-19 cases eased this month.
"We've seen this story play out in the U.S. and the UK, as the virus gets under control and vaccinations go up, you're probably going to have a tremendous amount of pent up demand (in India) that's going to be unleashed onto the market," said Edward Moya, senior market analyst at OANDA. Indian refiners operated at an average rate of 92.37% of capacity in May, down from April's 96.82%, the government data showed.
Natural gas output rose 19.1% to 2.74 billion cubic metres, while crude oil production eased 6.2% to 580,000 bpd or 2.44 million tonnes, data showed.
As per MRC, Maire Tecnimont S.p.A. announced that a consortium composed of its subsidiaries Tecnimont S.p.A. and Mumbaibased Tecnimont Private Limited has been awarded an EPCC (Engineering, Procurement, Construction and Commissioning) Lump Sum contract by Indian Oil Corporation Limited (IOCL), for the implementation of a new polypropylene plant and the related product logistics facilities.
Ethylene and propylene are the main feedstocks for the production of polyethylene (PE) and polypropylene (PP), respectively.
According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 744,130 tonnes in the first four month of 2021, up by 4% year on year. Shipments of all PE grades increased. At the same time, PP deliveries to the Russian market were 523,900 tonnes in January-April 2021, up by 55% year on year. Supply of homopolymer PP and PP block copolymers increased, whereas shipments of PP random copolymers decreased.
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