India's oil demand is poised to reach 10 million barrels of oil per day (MMbopd) by 2040 -- up from 3.8 MMbopd last year -- as domestic energy consumption looked set for strong growth over the next 25 years, boosted by rising incomes and population as well as increased urbanization and industrialization, the International Energy Agency (IEA) commented Friday on its launch of the "India Energy Outlook 2015" report.
"India is set to contribute more than any other country to the rise in global energy demand over the next 25 years, underlining its ever-greater influence in Asia and on the world stage; even so, its energy demand per capita in 2040 would still be 40 percent below the world average," the IEA said in the press release.
The South Asian nation's oil demand would increase by more than in any other country and such requirements would primarily be met by increased imports, particularly from the Middle East, raising India’s oil import dependence to above 90 percent. The greater dependence on foreign oil supplies by India in 2040 -- compared to 71 percent of total net oil imports in 2012 estimated by the U.S. Energy Information Administration -- is a development that IEA noted requires "constant vigilance as to the implications for energy security."
"Oil use increases by 6 million bpd as new passenger vehicles are added to the stock and as LPG (liquefied petroleum gas) substitutes for fuelwood as a cooking fuel in households," the IEA said in its World Energy Outlook 2015 Factsheet.
The Paris-based agency added that domestically, India's oil production tails off to around 700,000 bopd by 2040 "as limited resources and relatively high costs constrain new oil projects."
Meanwhile, the country's natural gas production is forecast to rise to 3.18 trillion cubic feet (Tcf) or 90 billion cubic meters (bcm) in 2040, with the supply deficit to be met by increasing imports, mainly liquefied natural gas (LNG).
Speaking at the launch of the IEA report, India's Minister for Petroleum & Natural Gas Dharmendra Pradhan promised policy interventions to enhance the investment appeal of the local oil and gas sector.
"We are keen to make India's oil and gas sector fair, transparent and attractive for domestic and foreign investors through appropriate policy, regulatory and fiscal interventions," he said, as quoted by local daily The Economic Times, adding that "in line with the vision of Prime Minister (Narendra Modi), we want to cut down India's import dependence for domestic energy needs by 10 percent in the next 6-7 years."
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