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Indian refineries reduced fuel sales in April due to the second wave of coronavirus infections

May 06/2021

MOSCOW (MRC) -- Indian state refiners' local fuel sales in April declined due to state-level restrictions aimed at stemming a rampant second wave of coronavirus infections, preliminary data shows, said Hydrocarbonprocessing.

The deadly second wave topped 400,000 new daily cases for the first time on Saturday. Authorities reported 401,993 new cases in the previous 24 hours, the highest daily count globally, after 10 consecutive days over 300,000. Deaths from COVID-19 jumped by 3,523, taking the total toll in India to 211,853.

"Overall fuel demand is down by about 7% from pre-covid level of April 2019," said A.K. Singh, head of marketing at refiner Bharat Petroleum Corp. "We were near pre-covid level in March but new restrictions and covid wave-2 has temporarily reduced demand equivalent to about 10% of March demand for both personal mobility and industrial goods movement," Singh told Reuters.

He said the local fuel consumption will 'start to look up' in June, by when second wave of coronavirus is expected to weaken. Analysts are expecting India's demand for transportation fuels to witness a sharper slump in May due to more impending restrictions.

Declining fuel sales will reduce crude intake by refiners. The country's top refiner Indian Oil Corp is operating refineries at an average 95% capacity. State companies - IOC, Hindustan Petroleum Corp and BPCL - own about 90% of India's retail fuel outlets.

State retailers' fuel sales in April declined from their sales in March and April 2019 levels, while posting a sharp rise from the year ago month when there was a nation-wide lockdown.

As MRC informed earlier, COVID-19 outbreak has led to an unprecedented decline in demand affecting all sections of the Russian economy, which has impacted the demand for petrochemicals in the short-term. However, the pandemic triggered an increase in the demand for polymers in food packaging, and cleaning and hygiene products, according to GlobalData, a leading data and analytics company. With Russian petrochemical companies having the advantage of access to low-cost feedstock, and proximity to demand-rich Asian (primarily China) and European markets for the supply of petrochemical products, these companies appear to be well-positioned to derive full benefits from an improving market environment and global economy post-COVID-19, says GlobalData.

We remind that in December 2020, Sibur, Gazprom Neft, and Uzbekneftegaz agreed to cooperate on potential investments in Uzbekistan including a major expansion of Uzbekneftegazs existing Shurtan Gas Chemical Complex (SGCC) and the proposed construction of a new gas chemicals facility. The signed cooperation agreement for the projects includes the creation of a gas chemical complex using methanol-to-olefins (MTO) technology, and the expansion of the production capacity of the Shurtan Gas Chemical Complex.

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 576,270 tonnes in the first three month of 2021, up by 4% year on year. Low density polyethylene (LDPE) and high density polyethylene (HDPE) shipments increased. At the same time, PP shipments to the Russian market totalled 410,890 tonnes in January-March 2021, up by 56% year on year. Supply of homopolymer PP and PP block copolymers increased.


mrcplast.com
Author:Anna Larionova
Tags:petroleum products, crude oil, PP, PE, neftegaz, petrochemistry, India.
Category:General News
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