India to account for over 40% of global oil demand growth by 2035
The world’s energy landscape is undergoing a significant transformation, driven by the increasing demands of emerging economies. India, in particular, is poised to play a crucial role in shaping the global energy market in the coming years. According to recent estimates shared by the Minister of Petroleum and Natural Gas, Hardeep Singh Puri, India will account for over 40% of the global increase in oil demand and about 8% of the growth in natural gas demand between 2024 and 2035. This projection underscores the country’s growing importance in the global energy equation and highlights the need for sustained efforts to enhance domestic exploration and production.
The data, which was shared by Minister Puri in response to a starred question in the Lok Sabha, provides valuable insights into India’s energy trajectory. The country’s oil demand is expected to rise significantly, driven by rapid urbanization, industrialization, and a growing middle class. As the world’s third-largest consumer of oil, India’s energy needs are likely to have a profound impact on global energy markets. The International Energy Agency (IEA) has also forecasted that India will be the largest contributor to global oil demand growth, accounting for about 25% of the increase in global oil consumption between 2020 and 2025.
The government’s estimates also highlight the importance of natural gas in India’s energy mix. The country aims to increase the share of natural gas in its energy basket from 6.2% in 2020 to 15% by 2030. This ambitious target is driven by the need to reduce the country’s reliance on polluting fuels and mitigate the impact of climate change. The growth in natural gas demand is expected to be driven by the power, industrial, and transportation sectors, which are increasingly adopting cleaner fuels to reduce their carbon footprint.
To meet the growing demand for oil and natural gas, the government has outlined a series of initiatives to enhance domestic exploration and production. The Ministry of Petroleum and Natural Gas has launched several policies and programs aimed at attracting investment, improving efficiency, and increasing transparency in the energy sector. These initiatives include the Hydrocarbon Exploration and Licensing Policy (HELP), which provides a framework for the allocation of hydrocarbon blocks, and the Discovered Small Fields (DSF) policy, which aims to monetize small and marginal fields.
The government has also emphasized the need for private sector participation in the energy sector. The production sharing contract (PSC) regime, which allows private companies to explore and produce oil and natural gas, has been instrumental in attracting foreign investment and expertise. The government has also introduced measures to simplify the regulatory framework, reduce bureaucratic hurdles, and provide fiscal incentives to encourage investment in the energy sector.
However, despite these efforts, India’s energy sector faces several challenges. The country’s dependence on imports to meet its oil and natural gas needs remains a significant concern. India imports over 80% of its oil requirements, which makes it vulnerable to price volatility and supply disruptions. The government has set a target to reduce the country’s import dependence by 10% by 2022, but achieving this goal will require sustained efforts to enhance domestic production and improve energy efficiency.
In conclusion, India’s energy landscape is undergoing a significant transformation, driven by the country’s growing demands for oil and natural gas. The government’s estimates, which forecast that India will account for over 40% of the global increase in oil demand and about 8% of the growth in natural gas demand between 2024 and 2035, highlight the need for sustained efforts to enhance domestic exploration and production. The government’s initiatives to attract investment, improve efficiency, and increase transparency in the energy sector are welcome steps, but more needs to be done to address the country’s dependence on imports and mitigate the impact of climate change.
As the world’s energy landscape continues to evolve, India’s role in shaping the global energy market will only continue to grow. The country’s energy trajectory will have a profound impact on global energy markets, and it is essential that policymakers, industry stakeholders, and civil society work together to ensure that India’s energy needs are met in a sustainable and environmentally responsible manner.
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