India shipped up to 1.4M tonnes of diesel to Europe in Sept., the highest since records began in 2017.
India has quietly set a new energy milestone. In September, the country’s diesel exports to Europe likely surged to record highs, according to shiptracking data and trade sources.
Volumes from India, Asia’s key swing supplier, are estimated at 1.3 million to 1.4 million metric tonnes (9.7–10.4 million barrels) headed to Europe last month. It’s the highest level since such records began in 2017, data from LSEG, Kpler and industry sources revealed.
The export push came as European refiners shut plants for seasonal maintenance, tightening supplies across the continent. India’s refiners, which source roughly a third of their crude from Russia, ramped up runs and diverted surplus products abroad, pushing both gasoline and diesel exports to multi-year highs.
Overall, India’s total diesel exports for September touched nearly 3 million tonnes, a five-year peak, according to Kpler data.
Why the Surge?
A widening east-west diesel spread gave traders strong incentives to ship fuel westward. Prices averaged $45 per tonne in September, up from less than $30 in August, while shipping costs on the India-Europe route dropped by about $10 per tonne.
Freight data showed the cost to move 90,000 tonnes of refined fuel fell to $3.25–$3.5 million in late September, down from $4–$4.2 million just weeks earlier. In Europe, the supply crunch deepened, with 550,000–600,000 barrels per day of refining capacity expected offline in October, compared to 400,000 bpd in September.
Ripple Effects
India’s increased flows to Europe have left Asia tighter, driving 10-ppm sulphur gasoil premiums to $1.50 a barrel, the highest in two months. Looking ahead, analysts warn the September surge may be short-lived. Vortexa’s Ivan Mathews predicts India’s fuel exports could dip in October as domestic demand spikes during the Diwali festive season. Still, higher margins compared to last year may keep refiners tempted to maintain strong export volumes.
The Uncertainty Factor
Traders remain cautious, pointing to the European Union’s upcoming 18th sanctions package, which bans refined products made from Russian oil. How it will impact India’s shipments, given its reliance on Russian crude, remains unclear. For now, India has taken the crown as Europe’s diesel lifeline. But with shifting sanctions and festive demand at home, October could tell a very different story.
Source: Reuters
