Insatiable Thirst For Oil

In the Eighties, consumption of oil was the highest in Europe followed by North America. European oil demand, more or less, remained stagnant over the last 15 years, whereas Asian-Pacific countries picked up consumption in the Nineties. Notably, the current demand drivers are India and China. There are multiple competing arguments supporting oil consumption growth in the Asia-Pacific region. The most significant reason behind demand growth is linked to the development cycle of emerging economies in the Asia-Pacific region, especially India and China. Like China, India is undergoing a transition from ‘developing’ to ‘developed’ stage, resulting in an exponential increase in the demand for energy. India’s crude oil import increased from 99 million metric tonnes (MT) in 2005-06 to 214 MT in 2016-17, registering a compound annual growth rate of 7.2 per cent.

In 2016, India registered a GDP growth rate of 7.1 per cent compared to heavyweights like China (6.7 per cent), USA (1.6 per cent), France (1.2 per cent), Germany (1.9 per cent), and Japan (1 per cent). In 1980, India and China, with a combined GDP of $613 billion, contributed about 2 per cent of the world GDP of $27.8 trillion. In 2016, with close to $12 trillion combined GDP, India and China together enhanced their share to 15 per cent of $77.3 trillion world GDP. Read More…

China, India, Oil