Sale of petrol rebound in August but diesel continues to decline

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 per cent in July, increased 5.8 per cent to 2.81 million tonnes in August when compared with 2.66 million tonnes of demand in the previous month.

The consumption was almost 16 per cent higher than August 2021 and 31.7 per cent more than 2.14 million tonnes in the same month in 2020. It was 20.6 per cent 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 per cent 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 per cent in July.

Consumption of diesel in August was, however, 23.5 per cent higher year-on-year, supported by 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 per cent higher than the 4.26 million tonnes demand during August 2020 and 11.6 per cent 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.

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 per cent higher than last year and 118.9 per cent more than August 2020. It, however, was 14.3 per cent lower than pre-COVID August 2019.

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

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

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

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

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