Oil prices are trading flat this morning, continuing their sideways trading trend seen since Wednesday. With India’s COVID cases rising and their hospitals filling, traders are concerned about the potential impact on demand. India consumed around 5.3 MMbpd in 2019, making it the third-largest consuming country.
Putting India’s oil demand situation in context: their daily consumption is roughly a quarter of American daily demand. Bloomberg reported that India’s gasoline and diesel demand could fall 20% in April compared to previous months, due to lockdowns in major population areas like New Delhi. Crude purchases have held steady so far as refiners run at 95% capacity, but falling fuel demand is expected to force a refining slowdown.
Yesterday President Biden announced a goal to reduce America’s carbon emissions by 50% from 2005 levels by 2030. Biden announced the goal on an international climate summit this week attended virtually by 40 nations. The goal comes amid proposed legislation to improve US infrastructure and invest in clean energy solutions. Biden stated clearly on the campaign trail that any transition from fossil fuels would be slow and steady, but his rhetoric lately has been strongly in favor of more sustainable approaches. Still, his promise to reduce emissions lacks any specifics for now, so it’s unclear how Biden plans to reach the goal.