India's refined fuel exports hit lowest level since October 2022 amid maintenance shutdowns

India's exports of refined petroleum products dropped sharply in May to their lowest level in more than two and a half years, as refinery maintenance shutdowns, changes in production priorities, and rising domestic fuel demand reduced the volumes available for overseas markets.

According to data from energy analytics firm Kpler, India's refined fuel exports fell to around 930,000 barrels per day (bpd) in May, marking the lowest monthly export level since October 2022, when shipments averaged approximately 926,000 bpd. The decline highlights the growing influence of domestic market requirements and operational constraints on the country's fuel export strategy.

India, one of Asia's largest exporters of refined petroleum products, has traditionally shipped significant volumes of diesel, gasoline, jet fuel, and other petroleum products to international markets. However, several factors combined in May to curb export availability.

A major contributor was the scheduled maintenance programme at Reliance Industries' Jamnagar refining complex in Gujarat, the world's largest refining hub and a key supplier of refined fuels to global markets. The maintenance activity temporarily reduced crude processing rates, limiting the volume of petroleum products available for export.

"The sharp cutback was driven by a combination of lower refinery throughput, maintenance activity, and a structural pivot toward the domestic market," said Sumit Ritolia, Model and Refining Manager at Kpler.

Beyond maintenance-related disruptions, Indian refiners also altered their product mix to meet growing domestic energy requirements. Several refiners increased production of liquefied petroleum gas (LPG), a fuel widely used in Indian households for cooking and heating. This shift came at the cost of export-oriented fuels such as petrol and diesel.

According to Kpler estimates, refiners reduced gasoline and diesel output by around 80,000 bpd as they redirected production capacity toward LPG. The move reflects efforts to ensure adequate domestic supplies amid rising local consumption and government's focus on energy availability.

State-owned refiners also played a role in the decline. Public sector oil companies reportedly allocated a larger share of their fuel production to domestic consumers rather than overseas buyers. The strategy aligns with broader energy security considerations and the need to maintain sufficient fuel inventories within the country.

Industry analysts note that the shift toward domestic supply has become increasingly important as India's fuel consumption continues to grow alongside economic activity, infrastructure expansion, and rising transportation demand.

Export economics have also become less attractive for refiners. Ritolia noted that taxes and levies on refined petroleum product exports have reduced the profitability of overseas shipments compared with domestic sales. As a result, refiners have had fewer incentives to maximise export volumes, especially during periods of operational constraints.

The latest data highlights how India's refined fuel trade is being reshaped by a combination of refinery maintenance schedules, evolving domestic fuel demand, and policy priorities. While temporary disruptions such as refinery turnarounds can affect export volumes in the short term, the increasing emphasis on meeting local energy requirements may continue to influence shipment patterns in the months ahead.

Despite the decline, India remains a major player in global refined fuel markets, supplying petroleum products to countries across Asia, Europe, Africa, and the Middle East. However, May's export figures suggest that domestic considerations are increasingly taking precedence over export growth, particularly during periods of constrained refining capacity.

The development underscores the balancing act facing Indian refiners as they seek to meet growing domestic fuel demand while maintaining the country's position as a leading exporter of refined petroleum products.

(With PTI inputs)