According to traders and analysts, India's diesel exports to Singapore will exceed 330,000 metric tonnes in August, thanks to lower freight costs and low inventories in the Asian oil hub. The country's August fuel exports to Europe are on track to be the lowest this year, as shipments to the east are more profitable, but that situation may not last.

The increase in Indian diesel exports to Singapore will partially compensate for lower exports from refiners in northeast Asia, including China, and the increased availability will thus cap Asia's strong refining margins. Lower South Asian imports, on the other hand, will help European refiners' margins.

Based on shiptracking data from Refinitiv, Vortexa, and Kpler, India is on track to ship between 330,000 and 439,000 tonnes of diesel to Singapore in August. According to Serena Huang, Vortexa's head of Asia-Pacific analysis, the volume is the highest since January 2022.

"The seasonal lull in India's petrol and diesel domestic demand due to the monsoon has seen the country raising its clean product exports for August to date," she said, referring to refined products like diesel, jet fuel and petrol.

According to Sparta Commodities data, freight costs for the India-Singapore route were around $21 per tonne less than the India-northwest Europe route in late July, compared to $14 a tonne in mid-July, making it more profitable for sellers to send cargoes east.