Trailing oil demand in India shows economy not fully recovered

The world’s biggest lockdown may have eased in India, but the country’s oil refineries are finding it tough going to pull off a complete recovery as fuel demand remains below pre-virus levels and stockpiles swell.

Operations across 23 refineries nationwide were at 77% of capacity in May, according to oil ministry data. While that was an improvement from a low of 72% in April, when stay-at-home orders decimated fuel demand and filled storage tanks to the brim, it was still well down on the 102% recorded a year earlier. The amount of crude processed, also known as refinery throughput, was almost 25% lower year-on-year last month.

Across India, restrictions on everything from the movement of people to business operations put in place on March 25 pummeled demand for transportation and industrial fuels, placing Asia’s third-largest economy on course for its first annual contraction in more than four decades this year.