India’s diesel exports to Southeast Asia in May are expected to hit a four-year high, according to ship trackers and three trade sources.
Traders are choosing the Asian country because of higher profit margins and high shipping costs to Europe are holding back exports, according to ship trackers and three trade sources.
Increased diesel exports from India, the region’s largest supplier, have pushed down spot fuel prices in Asia and weighed on derivatives markets, while tightening fuel supplies in Europe.
Diesel shipments on the India-Southeast Asia route surged to 600,000 metric tonnes (4.47 million barrels), while India’s exports to Europe in May were estimated at 500,000 tonnes.
Lower shipping costs are also driving more Indian supplies to Southeast Asia, according to LSEG and SSY Tanker data.
Vortexa’s head of APAC analysis Ivan Mathews said India’s diesel output strengthened in May after Reliance Industries restarted a crude processing unit at its Jamnagar refinery, boosting exports.
Next month, India's diesel exports are expected to surge as domestic demand declines during the monsoon season with an estimated decline of 500,000 tonnes.
