OPEC predicts India's oil demand will grow faster than China's

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Posted by AI on 2025-05-15 17:54:46 | Last Updated by AI on 2025-12-21 09:30:27

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India is set to eclipse China as the main driver of oil demand growth over the next few years, according to the Organization of the Petroleum Exporting Countries (OPEC). In its annual World Oil Outlook, OPEC predicted that India's oil demand will grow by 3.4% in 2025, double the pace of China. This highlights a significant shift in the global energy landscape, with developing countries now driving the world's energy demand.

"Over the past decade, India has overtaken China as the country with the fastest-growing oil demand worldwide," the report says. While the outlook for China's oil demand remains robust, its consumption is set to fall in the coming years due to a policy of reducing carbon dioxide emissions. In contrast, India's oil demand is expected to grow continuously until 2030, according to the report.

The primary reason for this divergence is starkly different fiscal policies. China's recent efforts to reduce carbon emissions have pushed it to promote the development of electric vehicles and renewables. As a result, its oil demand growth has slowed. In contrast, India has no large equivalent to China's renewable energy push and has continued to invest heavily in oil.

The report highlights that the average Indian passenger car today uses more oil than the average American car, giving room for the potential of an increase in oil consumption as the car fleet expands. It emphasizes the country's evolving fuel needs and growing appetite for energy.

"Despite having ambitious renewable energy goals, India is unlikely to sacrifice oil demand growth to meet these targets, given the country's acute energy needs and its ongoing push to improve living standards," the report states.

This divergence in trajectories between India and China is forecast to continue after 2030, with India's oil demand set to grow steadily well beyond that point.

These projections present a world where the centres of global energy demand are shifting, away from the traditional Western powers to emerging economies. It highlights the need for sustainable and clean energy options to meet these growing demands and mitigate the impact of climate change.

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