(Reuters) - India’s crude processing in September fell 6.89% from a year earlier, its biggest decline since June, as refiners shut units for maintenance and fuel upgrades, provisional government data showed on Tuesday.
India, the world’s third-biggest oil importer and consumer, has set an April 1, 2020 deadline to migrate to Euro VI-compliant fuels to cut its carbon emissions.
Indian refiners processed about 19.41 million tonnes or 4.74 million barrels per day (bpd) of oil in September, the data showed.
While private refiners such as Nayara Energy and Reliance Industries Ltd RELI.NS can churn out superior-grade fuel, state-run companies were required to upgrade units to do so.
State refiners, which account for more than half of India’s nearly 5 million bpd refining capacity, processed 12.67% less oil last month compared with September 2018, the data showed.
India’s September crude output fell to 2.65 million tonnes, about 5.4% lower than a year earlier.
“Most of the oilfields are pretty old and they are displaying regular decline every year. While new discoveries have been made, they’ve not been brought into production so the net impact is there; this has been a trend for some time,” said K Ravichandran, senior vice president at ICRA, a unit of Moody’s Investors Service.
As for refineries, many Indian plants have been undertaking shutdowns for upgrades to meet the new, cleaner fuel standards, he said, adding India’s “import dependence has been going up”.
In August, India’s crude oil imports rose to a four-month peak, data from the oil ministry’s Petroleum Planning and Analysis Cell showed.
Indian refiners will have to shut gasoil- and gasoline-making units for 15 to 45 days to churn out Euro VI-compliant fuels from January 2020 to be able to sell them from April.
Natural gas output was 4.3% lower at 2.57 billion cubic metres from the same period last year.
Reporting by Sumita Layek and Shreyansi Singh in Bengaluru; Editing by Edmund Blair and Dale Hudson
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