(Reuters) – India’s fuel consumption in August fell by more than 2% year-on-year to 18.35 million metric tons, oil ministry data showed on Friday, with diesel demand hit due to above-normal monsoon rains.
WHY IT IS IMPORTANT
India is the third-largest consumer and importer of oil. The data is a proxy for the country’s oil demand.
KEY QUOTE
“I would describe the data point as mixed picture, with strength in gasoline, jet demand, LPG, but weakness in diesel, pet coke and naphtha. I guess the monsoon (too much rain) negatively impacted the agricultural sector, hence the weakness of diesel demand,” said analyst Giovanni Staunovo of UBS.
“Strong gasoline and jet fuel demand suggest solid travel activity.”
BY THE NUMBERS
Fuel demand was down 6.7% on a monthly basis versus 19.66 million metric tons in July, data from the Petroleum Planning and Analysis Cell’s (PPAC) website showed.
Sales of diesel, mainly used by trucks and commercially run passenger vehicles, fell 2.5% from a year earlier and totaled 6.50 million metric tons in August. It was down nearly 10% on a monthly basis.
Sales of gasoline or petrol were 8.6% higher from a year earlier at 3.36 million metric tons, and edged up nearly 2% from July .
Jet fuel demand jumped 8.1% on a yearly basis and 0.7% from the previous month.
Demand for bitumen, used for making roads, dropped to over 17% annually.
Cooking gas or liquefied petroleum gas (LPG) sales increased 7.7% to 2.65 million metric tons, while naphtha sales fell 3.7% to 1.16 million metric tons year-on-year, the data showed.
Fuel oil use edged up 3.1% year-on-year in August.
CONTEXT
India is forecast to receive above-average rainfall in September after surplus rains in August, the weather department said last week.
India’s manufacturing activity growth eased in August as demand softened significantly, according to a survey, casting another shadow over the otherwise robust economic outlook.
DOMESTIC SALES (in million tons):
2024 2024 2024 2023 2023 2023
AUGUST JULY JUNE AUGUST JULY JUNE
Diesel 6.5 7.2 7.98 6.67 6.89 7.91
Petrol 3.36 3.3 3.3 3.09 2.98 3.15
LPG 2.65 2.63 2.32 2.46 2.39 2.23
Naphtha 1.16 1.15 1.01 1.21 1.04 1.06
Jet fuel 0.73 0.73 0.71 0.68 0.66 0.64
Kerosene 0.04 0.04 0.04 0.05 0.05 0.05
Fuel Oil 0.53 0.53 0.57 0.51 0.56 0.51
Bitumen 0.42 0.51 0.74 0.5 0.51 0.75
TOTAL 18.35 19.66 19.93 18.85 18.29 19.48
(Reporting by Swati Verma and Sherin Elizabeth Varghese in Bengaluru; Editing by David Gregorio)
