India’s Oil Output and Exports Decline Amid Tepid Refinery Activity in April

Key Highlights

• Base oil prices vary across regions, with packaged products priced higher, especially in Delhi.
• Crude oil production dropped 3.1% YoY; refinery throughput also declined slightly.
• Petroleum product exports fell by 12.4%, mainly due to reduced diesel and ATF shipments.
• Market outlook is bearish amid soft demand and volatile global pricing.

Regional Base Oil Prices Indicate Packaging Premium

• In bulk packaging of Base Oil, N150 is priced at ₹62.5/LTR in Mundra, SN150 at ₹61/LTR in Kandla, N70 at ₹62.5/LTR in Mumbai, N220 at ₹72/LTR in Kandla, N60 at ₹65/LTR in Kandla, and 8cST at ₹73/LTR in Mumbai. 
• For bulk-grade 4cST and SN500, prices stand at ₹75/LTR in Mumbai and ₹80/KG in Kandla respectively. High-viscosity base oils like N500 are costlier, priced at ₹95.5/KG in Silvassa. 
• In barrel packaging, Delhi shows higher pricing, with BS-150 at ₹117/KG, SN150 at ₹67/KG, N150 at ₹68.5/LTR, 4cST at ₹76.5/KG, SN500 at ₹86/KG, and N500 at ₹102/KG, indicating a premium for packaged products in the capital market.
• While specific pricing figures were not disclosed in the April 2025 Petroleum Planning and Analysis Cell (PPAC) report, market sentiment suggests a neutral-to-weak pricing environment.
• This is driven by declines in both production and exports of crude oil and petroleum products, alongside marginal reductions in imports. The lower throughput and subdued export activity, especially for high-margin products like HSD and ATF, point towards price moderation, particularly in the international market where India plays a significant refining and export role.

Demand and Supply: Domestic Crude Output and Refinery Activity Decline

• As per the economictimes.com, India's indigenous crude oil and condensate production dropped by 3.1% year-on-year to 2.3 MMT in April 2025. The breakdown shows ONGC producing 1.5 MMT, OIL with 0.3 MMT, and the remaining 0.5 MMT coming from PSC/RSC fields.
• Crude oil processing also saw a marginal contraction, with total throughput standing at 21.5 MMT, down 0.6% compared to April 2024. Public sector and joint venture refiners processed 15.2 MMT, while private refiners processed 6.3 MMT. Of the total, 1.9 MMT came from domestic crude, and 19.6 MMT from imports.
• Petroleum product output declined 4.2% year-on-year to 22.4 MMT, with 22.1 MMT from refineries and 0.3 MMT from fractionators. Product-wise, the output was dominated by:
  1. High-speed diesel (HSD): 42.2%
  2. Motor spirit (MS): 17.5%
  3. Naphtha: 6.5%
  4. Aviation turbine fuel (ATF): 6.4%
  5. Petcoke: 5%
  6. LPG: 4.4%
• Remaining share: Bitumen, FO/LSHS, LDO, lubricants, and others
• Crude oil imports dipped 1.0%, while POL product imports fell 9.0%, primarily due to decreased shipments of fuel oil and lubricating oil base stocks. Simultaneously, exports of POL products plunged by 12.4%, driven largely by weaker HSD and ATF export volumes.

News and Developments: Export Slowdown Adds Pressure on Margins

• Decline in domestic production: The fall in indigenous crude output reflects underlying challenges in upstream development, despite being dominated by national players like ONGC and OIL.
• Reduced refinery throughput: Processing of both domestic and imported crude declined, suggesting lower operational activity or strategic inventory management amid weak demand.
• Sharp fall in petroleum exports: Exports of refined products like diesel and jet fuel, which contribute significantly to foreign exchange earnings, fell sharply. This could impact trade balances and revenue for key players.
• Lower imports of lube and fuel oil: This signals either reduced downstream demand or improved domestic availability.
• Shift in product mix: The dominance of HSD and MS in output shows sustained domestic consumption of transport fuels, although at moderated levels.

Market Expectation: Bearish Market Outlook Amid Demand Uncertainty

Looking ahead, the market sentiment remains cautiously bearish. Supply constraints are not the primary concern; rather, demand-side pressures, subdued exports, and volatile global oil prices are expected to shape near-term trends. Unless domestic demand recovers or global product pricing improves, refinery margins may remain under stress, and pricing is likely to stay subdued or rangebound.