India To Lead Global Oil Demand Growth Through 2030: IEA

New Delhi, Jun 18 (KNN) India is set to account for the largest increase in global oil demand over the next five years, with consumption projected to rise by one million barrels per day (BPD), making it the primary driver of global growth, according to the International Energy Agency’s (IEA) 2030 outlook released on Tuesday.

Currently consuming five million BPD—of which approximately 85 percent is imported—India’s growing reliance on foreign oil is likely to pose energy security challenges, particularly amid ongoing global uncertainties. 

The IEA cited geopolitical tensions, regional conflicts, and shifts in OPEC+ production strategies as contributing factors to an increasingly volatile oil market.

“India's stellar expansionary trajectory will continue unabated, with GDP growth averaging 6.4 percent over the forecast period—the highest among all major economies,” the IEA report stated. 

It identified key structural factors including a growing middle class, increasing spending power, and a youthful demographic profile as major drivers of this surge in demand.

The report also noted that improvements in infrastructure, urbanisation, and industrialisation are enhancing mobility and car ownership, making India's economy more energy-intensive. 

Despite the global trend toward electrification, especially in transport, India remains a notable outlier, with demand for transport fuels projected to lead the growth in oil consumption. Jet fuel, in particular, is expected to witness the fastest growth.

In response, India has initiated a comprehensive strategy to reduce its dependence on imported crude. 

This includes boosting domestic production, expanding the use of alternative fuels such as biogas and ethanol, accelerating the electrification of the transport sector, and scaling up renewable energy generation.

However, the IEA cautioned that its projections carry significant uncertainty due to the possibility of escalating conflicts in the Middle East and unresolved trade negotiations. 

These variables could materially alter the global supply-demand balance and, by extension, India’s energy outlook.

The report underscores the delicate balance India must maintain between meeting rising energy demands and ensuring long-term energy security amid a rapidly evolving global landscape.

(KNN Bureau)