India expands refining capacity to boost diesel exports and global energy standing

India is set to significantly scale up its diesel exports from 2027 as state-run oil refiners expand their processing capacity, cementing the country's position as a reliable global fuel supplier and refining hub during a period of tight worldwide supply.

State refiners plan to add 16.5 million tonnes of annual diesel production capacity in 2027. The expansion forms part of the government's strategic vision to boost India's total refining capacity to 300 million tonnes per year by 2030, with eventual plans to reach 400 million tonnes per year.

"We will be in a happy situation of not only refining for ourselves but for the world," said Oil Minister Hardeep Singh Puri, noting that India is rapidly establishing itself as a key refining center as global demand grows.

How state refiners are boosting capacity

India has already emerged as the second-largest exporter of seaborne diesel this year behind the United States, according to ship-tracking data from Kpler. While private refiners such as Reliance Industries and Nayara Energy currently handle the bulk of fuel exports, state companies are now expanding to cover local demand directly and free up greater volumes for export markets.

Indian Oil Corp chairman A S Sahney said the country's largest refiner aims to add about 18 million tonnes of overall annual capacity, generating roughly 8 million tonnes of additional diesel.

Hindustan Petroleum Corp chairman Vikas Kaushal confirmed that the company's new 9-million-tonne refinery in Rajasthan will turn out 3 million tonnes of diesel annually once operations stabilise next year. Oil India's subsidiary, Numaligarh Refinery in eastern India, will expand to 9 million tonnes annual capacity by March, adding another 3 million tonnes of diesel production.

Bharat Petroleum Corp chairman Sanjay Khanna stated that his company plans to produce an extra 1.5 million tonnes of diesel from next year.

Strengthening global energy security

By manufacturing more fuel domestically, state refiners will rely less on buying refined products from private producers for local retail networks, unlocking those private supply streams directly for overseas shipments.

India's modernized refineries are designed to process a wide range of crude grades and flexible petrochemical feedstocks, enabling companies to optimize processing costs and deliver high-value fuel products to international markets.

During a recent visit to Reliance's refining facility in Jamnagar, US Secretary of State Marco Rubio described India as a refining "superpower". The expansion underscores India's growing importance in stabilizing global fuel markets and driving economic expansion.