Energy surge: India set to become epicentre of global oil demand growth; IEA projects fastest energy expansion to 2035

India is poised to become the epicentre of global oil demand growth over the next decade, the International Energy Agency (IEA) said in its latest Global Energy Outlook 2025, citing rapid economic expansion, industrialisation, and rising vehicle ownership as key drivers of energy consumption.

According to the Paris-based agency, India’s energy demand is projected to rise by an average of 3% annually till 2035, the fastest among all emerging markets and developing economies, PTI reported. The country will account for the largest increase in global oil consumption through 2035, surpassing China and Southeast Asia combined.


“China accounted for more than 75% of oil demand growth over the past decade, but this picture is changing. India becomes the new epicentre of growth in oil demand,” the IEA said.

India’s oil use is expected to rise from 5.5 million barrels per day (mbpd) in 2024 to 8 mbpd by 2035, driven by growing car ownership, demand for plastics and chemicals, aviation fuel, and increased LPG use for cooking. Nearly half of all additional global oil demand till 2035 will come from India alone, the agency noted.

Import dependence to deepen

Despite government efforts to boost domestic production, India’s oil import dependency is set to climb from 87% in 2024 to 92% by 2035, the IEA projected. However, the country’s expanding refining capacity — expected to grow from 6 mbpd in 2024 to 7.5 mbpd by 2035 — will position it as a key exporter of transport fuels.

“Since 2022, India has emerged as a global swing supplier, refining Russian crude oil that previously went to Europe,” the report said. With 9 mbpd of new refining capacity expected globally between 2024 and 2035, Asia will lead the expansion, with India contributing the largest share.

Gas and coal outlook
India’s natural gas demand is projected to nearly double to 140 billion cubic metres (bcm) by 2035, led by growth in city-gas distribution. LNG imports are also expected to surge, reaching 50 bcm by 2035, up from 35 bcm currently.

Coal production, meanwhile, will continue to rise in India — even as it declines globally — increasing by around 50 million tonnes of coal equivalent (Mtce) by 2035. The IEA said this will help limit the growth of coal imports despite strong domestic demand. Coal India Ltd’s expansion of the Gevra mine to 70 million tonnes per year will make it Asia’s largest coal mine, with 36 new mines also planned over the next five years.

Energy leadership beyond oil
The IEA described India as “the biggest driver of growth in global energy demand”, with overall consumption projected to rise by over 15 exajoules by 2035 — nearly equal to the combined increase of China and Southeast Asia.

India’s GDP is expected to grow at over 6% annually, with transport and industry leading the rise in fuel use. The country’s carbon emissions are likely to peak around 2040 at roughly 3.4 gigatonnes per year.

India, which has pledged to achieve net zero by 2070, has already met its target of 50% non-fossil power capacity five years ahead of schedule, in 2025. The share of renewables in installed capacity is projected to reach 60% by 2030 and 70% by 2035, accounting for 95% of new power additions.

Solar and wind will make up nearly one-fifth of India’s total energy mix by 2050, the IEA said, adding that solar PV has already attracted $113 billion in investment over the past decade, outpacing fossil fuel projects.