Given the limited connectivity to other US refining hubs, the most likely source of replacement fuels (for California) will be imports from Asia, particularly of jet fuel and gasoline.
| Photo Credit:
BING GUAN
India’s refined petroleum products exports are expected to remain steady in the 2026 calendar year aided by refinery maintenance on the US West Coast, a development that will help refiners such as Reliance Industries (RIL) capitalise on petrol and jet fuel shipments to California.
Besides, refinery capacity additions and higher utilisation back home is also expected to boost product availability.
Global real time data and analytics provider Kpler expects India’s refined product export to remain constructive, supported by high refinery utilisation, flexible configurations and continued export optionality into both the Atlantic Basin and Asia.
Incremental throughput growth is likely as new capacity and ramp-ups at HPCL Rajasthan Refinery (HRRL) progress, while expansions at sites such as Panipat (Indian Oil Corporation) and stronger utilisation across other public and private refineries lift overall product availability.
Refinery economics should remain supportive given continued access to discounted and advantaged crude feedstocks, helping India maintain export competitiveness even if global margins soften, said Sumit Ritolia, Kpler’s Lead Research Analyst for Refining & Modeling.
Steady sailing
“In addition, refinery closures and rationalisation in PADD 5 are expected to increase California’s reliance on imported gasoline and blend stocks, creating an additional outlet for Indian barrels, where RIL has historically been an important supplier,” he told businessline.
Washington’s refining sector is organised into Petroleum Administration for Defense Districts (PADDs) with PADD 5 catering to the West Coast. The US Energy Information Administration (EIA) expects the upcoming loss of refinery capacity at the West Coast to contribute to relatively higher gasoline margins and gasoline prices that are about equal to 2025, in nominal terms.
Given the limited connectivity to other US refining hubs, the most likely source of replacement fuels (for California) will be imports from Asia, particularly of jet fuel and gasoline.
However, the main near-term constraint is higher planned refinery maintenance versus last year, with April–May and August–September likely to see peak turnaround activity that temporarily reduces runs and export availability and increases volatility, Ritolia added.
On the demand side, Ritolia said that domestic growth remains healthy but uneven, with stronger gasoline (petrol) growth than gasoil (diesel), meaning incremental supply could skew toward middle distillates and ATF as new units stabilise.
As a result, exports will remain a key clearing mechanism in 2026, particularly for diesel and jet fuel during periods of high utilisation and outside peak domestic demand windows, he explained.
EU sanctions
On impact on the European Union’s (EU) 18th sanctions package, which came into effect on January 21, Ritolia said it is still very early to draw firm conclusions.
However, with new EU restrictions now in force, export-oriented refiners that previously relied on Europe as a key outlet are expected to shift toward lower-risk crude feedstocks and reduce exposure to Russian barrels and other higher-compliance origins, since those volumes can no longer be monetised as easily, he added.
“As a result, we could see increased preference for Middle East and other ‘clean’ Atlantic Basin crudes, while some refiners may cut runs, redirect products to non-EU markets at weaker netbacks, or adjust crude slates to remain compliant,” Ritolia noted.
Netback calculates the revenue generated from oil and gas sales against costs incurred to bring the product to market.
“The most impacted exporters have been RIL and Mangalore Refinery and Petrochemicals (MRPL). So far RIL has not imported Russian barrels since December 19 (2025), while MRPL has not imported Russian crude since late November, although it remains too early to generalise a firm trend as refiners will continue to optimise based on economics and execution feasibility,” he said.
Importantly, even without Europe as an outlet, there is still strong global demand for refined products, and Kpler does not expect any major issues in clearing Indian product exports overall.
Published on January 26, 2026
