India's petrol and diesel consumption fell in the first half of August from the previous month and a year ago, as monsoon rains hit mobility and slowed industrial activity, preliminary data of state-owned firms showed on Wednesday, August 16, 2023.
This is the second month in a row that fuel sales have fallen. The four months of monsoon generally see muted consumption.
Consumption of diesel, the most consumed fuel in the country accounting for about two-fifths of the demand, fell 5.7 per cent to 2.67 million tonnes from August 1 to 15, compared to the year-ago period.
Consumption had fallen by a steep 15 per cent in the first half of July but picked up in the second fortnight.
Month-on-month sales fell 9.5 per cent, when compared with 2.95 million tonnes of diesel consumed in the first half of July.
Diesel sales typically fall in monsoon months as rains lower demand in the agriculture sector which uses the fuel for irrigation, harvesting and transportation. Also, rains slow vehicular movements.
Consumption of diesel had soared 6.7 per cent and 9.3 per cent in April and May, respectively as agriculture demand picked up and cars yanked up air-conditioning to beat the summer heat. It started to taper in the second half of June after the monsoon set in.
Petrol sales fell 8 per cent to 1.19 million tonnes in the first fortnight of August, when compared with the same period last year.
Consumption had dropped 10.5 per cent in the first fortnight of July but picked up in the latter half. Sales were down 5.2 per cent month-on-month, the data showed.
India's economy has demonstrated remarkable resilience and is likely to have surpassed the performance of most major economies during the first half of 2023.
With steady and healthy economic activity and ongoing air travel recovery, India's demand for oil products is anticipated to remain strong in the remainder of the fiscal, analysts said.
Consumption of petrol during August 1-15, was 20.6 per cent more than in the COVID-marred first half of August 2021 and 25.6 per cent more than in pre-pandemic August 2019.
Diesel consumption was up 26 per cent over August 1-15, 2021 and 16.8 per cent when compared with August 1-15, 2019.
Rise in ATF demand
With the continuing rise in passenger traffic at airports, jet fuel (ATF) demand rose 8.1 per cent to 290,300 tonnes during the first fortnight of August as compared to the same period last year.
It was 66.7 per cent more than in August 2021, but 4.1 per cent lower than pre-COVID August 2019.
Month-on-month jet fuel sales fell 2.1 per cent when compared with 296,500 tonnes in July 1-15, 2023.
Cooking gas LPG sales were up 3.7 per cent year-on-year to 1.21 million tonnes in August 1-15. LPG consumption was almost 12 per cent higher than in August 1-15, 2021 and 11.2 per cent more than pre-COVID August 1-15, 2019.
Month-on-month, LPG demand was however down 2 per cent compared to 1.23 million tonnes of LPG consumption during July 1-15, the data showed.