India's fuel demand recovery gathers pace as lockdown eases

Reuters NEW DELHI | Updated on May 19, 2020 Published on May 19, 2020

A recovery in fuel demand in India gathered momentum in the first half of May versus April as curbs on transport and industrial activity were partly lifted in areas that have contained the spread of coronavirus, data from industry sources showed.

Demand for refined fuel is expected to get another boost from Monday as India has lifted more restrictions under its extended lockdown that runs until May 31.

Fuel demand growth in India, the world's third-biggest oil importer and consumer, plunged to historic lows in April.

State-refiners' petrol sales in the first half of May declined by 47.5 per cent to 570,000 tonnes from a year ago but were up from 334,000 tonnes sold in the first half of April. In April, petrol sales declined by 61 per cent.

State companies - Indian Oil Corp, Hindustan Petroleum Corp and Bharat Petroleum - own about 90 per cent of India's retail fuel outlets.

State companies' sale of gasoil fell about 38 per cent to about 1.93 million tonnes in the first half of May from a year earlier. In April, they had dropped by an average of 57 per cent. In the first half of April, the refiners sold 1.1 million tonnes of gasoil.

Indian refiners, which had cut crude processing because of a fall in fuel demand, are now gradually raising output.

India's overall refined fuel demand includes consumption of fuel oil, bitumen and liquefied petroleum gas (LPG).

State retailers sold 24 per cent more LPG in the first half of May from a year ago at 1.2 million tonnes. This compared with a 12 per cent increase in April.

India's LPG sales are rising as the country is providing free cooking gas cylinders to the poor for three months to June to help them weather the impact of the lockdown.

Sales of jet fuel plunged by 88 per cent to 39,000 tonnes during the first half of May versus a fall of 92 per cent in April, the data showed.

In the first half of April, refiners sold 19,000 tonnes of jet fuel and 1.07 million tonnes of LPG.

Published on May 19, 2020
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