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India's export boom likely to weaken with 2014 startup of Jubail refinery

Home Forums Refining Community Refinery News India's export boom likely to weaken with 2014 startup of Jubail refinery

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  • #1686


    The 2014 startup of the Jubail refinery will take the shine out of India’s product export boom and weaken global diesel prices, according to the recently-published Global Transport Fuel Outlook from energy consultancy ESAI Energy. 
    Coking & CatCracking Conference in New Delhi, India – 30 Sept – 4 Oct. 2013

    In product markets, the new refinery will add to the supply of clean diesel in Saudi Arabia and Europe — markets typically supplied by India. Since Indian refiners export diesel to so many markets, the appearance of this competing supply source will have bearish consequences for global diesel prices, the consultants predict.
    ndia’s private refiners exported close to 1.2 million bpd of products in 2012, 485,000 bpd of which was diesel (see map below). Due to its geography, India’s refiners have access to markets from the Atlantic Basin to Asia. 

    The Jubail refinery, a joint venture of Saudi Arabia and Total, will have the capacity to produce 235,000 bpd of ultra-low-sulfur diesel (ULSD). This output will make Saudi Arabia, the destination of 85,000 bpd of Indian diesel exports last year, now a net exporter.

    Additionally, Total is likely to export some of its share of diesel production, about 70,000 bpd, to Europe, potentially weakening Reliance’s position in that market, according to the consultants.

    With India’s domestic market experiencing weak demand and new state-owned capacity, India’s private refiners must look to other export markets, such as South Africa, Latin America and Asia.

    “There are direct consequences for all key diesel markets,” said Vivek Mathur at ESAI Energy. “Jubail will add to the availability of clean diesel to Europe, where demand continues to collapse. In 2014, the growing supply-demand mismatch will weaken the diesel spread to Brent. 

    “Unless India’s private refiners cut runs, they will have to target the Asian market,” he added. “But with China’s emergence as a diesel exporter, competition among suppliers will likewise be bearish for Singapore gas/oil spreads to Dubai.”

    HP 04.23.2013

  • #4495


    Lagging outlook – India was on ropes as product exporter long before MidEast spector. And China’s exports have had push out Asia sector all way into Europe which further backed volume/demand down.
    India’s Reliance Export Refinery had switch Domestic market right after startup in 2009 ?  <See story link @

    Reliance sheds export unit tag for Jamnagar refinery
    Business Line  04/17/2009
    New Delhi, April 16 Reliance Industries Ltd (RIL) has converted its first refinery (33 million tonne/year) at Jamnagar from an Export Oriented Unit (EoU) to a normal status so that it can sell all its products in the domestic market

  • #4493


    Duhh – I wonder if someone had wake ESAI consultants up complete this report?  India’s Export markets essentially died when the Reliance doubled its Jamangar 600MBD Refinery (3rd largest at time) by building a 550MBD export refinery next to it (both with 8 drum 127 &amp; 184MBD cplers) and started it up in 2010. It had reposition the export refineries products into its own domestic market because of economic &amp; demand conditions.
    Reposted on behalf of Charlie Randall.

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