Indian Refinery Runs Edge Higher in June

Indian refining throughputs rose back above 4mn b/d in June in a partial recovery from the Covid-19 downturn, but remained well below year-earlier levels.

Throughput was 4.28mn b/d last month, down by 14pc from 4.96mn b/d a year earlier but up from 3.86mn b/d in May, according to preliminary oil ministry data. Run rates averaged 5.09mn b/d in the financial year that ended in March, but slumped to 3.6mn b/d in April as the government implemented a nationwide lockdown to curb the spread of the coronavirus outbreak.

Throughputs held up more strongly at state-controlled refiners than at private-sector firms. State-run refiners excluding joint-venture plants processed 2.5mn b/d of crude in June, down by 10pc from 2.77mn b/d a year earlier but up from 2mn b/d in May. IOC, the country's biggest refiner, processed 1.36mn b/d of crude last month, almost in line with 1.42mn b/d in June last year and up sharply from 1mn b/d in May.

Private-sector Indian refiners reduced throughputs by 16pc to 1.48mn b/d in June from 1.76mn b/d a year earlier and 1.6mn b/d in May. Reliance Industries (RIL) processed 1.14mn b/d last month, down by 15pc from 1.34mn b/d a year earlier and lower than 1.26mn b/d in May. RIL operates the 1.36mn b/d Jamnagar refinery complex on India's west coast. Nayara Energy, which is owned by Russia's Rosneft, processed around 341,000 b/d last month, down by 19pc from 421,000 b/d in June 2019 and lower than 369,000 b/d in May. Nayara runs the 400,000 b/d Vadinar refinery, also in western India.

Throughputs may not recover as strongly as had been expected in July after a surge in Covid-19 cases prompted a series of localised lockdowns to be implemented, hitting fuel consumption and cutting off supply chains. Diesel and gasoline demand fell by 18pc and 6pc respectively in the first two weeks of July compared with a month earlier, according to data from state-controlled refiners.

India's partial nationwide lockdown has been extended until 31 July.