Petrol sales rebound in August, diesel lags

Petrol sales in India rebounded in August but diesel continued to show a decline over the previous month, showed official data
Petrol sales rebound in August, diesel lags

New Delhi: Petrol sales in India rebounded in August but diesel continued to show a decline over the previous month as rains in several parts chipped away demand in some sectors, preliminary industry data showed. Petrol sales, which had dipped 5 percent in July, increased 5.8 percent to 2.81 million tonnes (MT) in August when compared with 2.66 MT of demand in the previous month.

Petrol consumption surges past pre-pandemic level

The consumption was almost 16 percent higher than August 2021 and 31.7 percent more than 2.14 million tonnes in the same month in 2020. It was 20.6 percent higher than the pre-pandemic demand of 2.33 million tonnes in August 2019.

Diesel, the most widely used fuel in the country, saw consumption drop 4.9 percent to 6.11 million tonnes from 6.42 million tonnes in July.

The monsoon rains weigh heavily on diesel demand in the country and consumption traditionally is lower in July-September than in April-June. Rains restrict mobility and demand from the farm sector, which uses diesel in irrigation pumps and trucking.

Diesel demand had dipped 13.1 percent in July.

Consumption of diesel in August was, however, 23.5 percent higher year-on-year, supported by a strong economic growth and a relatively low baseline for the same period in 2021 when the second wave of COVID-19 had impacted the economy.

Diesel demand was 43.4 percent higher than the 4.26 million tonnes demand during August 2020 and 11.6 percent more than the pre-COVID sale of 5.48 million tonnes in August 2019, the data showed.

The decline in auto fuel sales in July and August came after a surge in June that was supported by increased summer travel to colder areas of the country to escape from the heat and vacations during annual breaks at educational institutions.

Jet fuel demand doubles month-on-month

As the aviation sector opened up, India's overall passenger traffic (both domestic and international) at airports inched closer to pre-COVID-19 levels.

Accordingly, jet fuel (ATF) demand more than doubled to 541,000 tonnes during August when compared to the previous month. It was 51.4 percent higher than last year and 118.9 percent more than August 2020. It, however, was 14.3 percent lower than pre-COVID August 2019.

With strong economic growth of 7.1 percent, India's oil demand has been rising steadily since the country eased pandemic lockdowns.

Cooking gas LPG sales were up 5 percent year-on-year at 2.44 million tonnes in August. LPG consumption was 7 percent higher than in August 2020 and 2.5 percent more than in August 2019.

Month-on-month, the demand slipped 1 percent when compared to 2.46 million tonnes of LPG consumption during July, the data showed.

(PSU Watch– India's Business News centre that places the spotlight on PSUs, Bureaucracy, Defence and Public Policy is now on Google News. Click here to follow. Also, join PSU Watch Channel in your Telegram. You may also follow us on Twitter here and stay updated.)

PSU Watch