India Expands Refining Capacity to Boost Global Diesel Exports

India is expanding its refining capacity to establish itself as a global hub, with diesel exports projected to surge starting in 2027. State-run companies plan to increase total diesel production capacity by 16.5 million tons in 2027 through the launch of new plants and the expansion of existing facilities.

Hardeep Singh Puri, the Oil Minister of India, stated that the country aims to become a global refining hub. This growth is part of a broader strategy to reach a refining capacity of 300 million tons per year by 2030, eventually scaling to 400 million tons. India is already the second-largest exporter of seaborne diesel this year, trailing only the United States.

Several state refiners are driving the expansion. Indian Oil Corporation aims to add approximately 18 million tons of annual capacity, while Bharat Petroleum plans to produce an additional 1.5 million tons of diesel starting next year. Hindustan Petroleum is operating a new 9-million-tpy refinery in Rajasthan, and Numaligarh Refinery Limited is expanding to add 3 million tons of diesel production.

The expansion aims to position India as a swing supplier in a global market disrupted by conflicts in Ukraine and the Middle East. Additionally, the move reduces the reliance of state refiners on purchasing refined products from private firms for domestic retail.