India’s fuel consumption in October registered its first year-on-year increase since February, as slowing coronavirus cases and increased mobility accelerated an economic recovery, data showed on Thursday.
Consumption of refined fuels, a proxy for oil demand, rose 2.5 per cent in October from the prior year to 17.78 million tonnes and nearly 15 per cent higher from the previous month, data from the Petroleum Planning and Analysis Cell (PPAC) of the Ministry of Petroleum & Natural Gas showed.
Total and bp upbeat about Indian energy growth
“GST (Goods and Services Tax) collections, power demand, PMI, etc, all are indicating increased economic activity and Covid cases are also coming down to a point where demand is coming back to normalcy,” said K Ravichandran, senior vice-president at ICRA, a unit of Moody's Investors Service.
With public transportation gradually picking up, fuel demand is expected to improve further, he added.
India’s daily Covid-19 case count has steadily declined since September, although total cases remain north of 8.5 million, the second highest in the world.
Activity in India’s dominant services industry also expanded for the first time in eight months in October as demand surged.
Diesel, LPG consumption
Diesel consumption, a key parameter linked to economic growth and which accounts for about 40 per cent of overall refined fuel sales in India, rose 7.4 per cent to 6.99 million tonnes on an annual basis, and climbed about 27 per cent month-on-month.
Sales of gasoline, or petrol, rose by 4.3 per cent from a year earlier to 2.65 million tonnes, and by 8.2 per cent from 2.45 million tonnes from September.
Cooking gas or liquefied petroleum gas (LPG) sales increased by 3 per cent to 2.42 million tonnes from a year earlier and 6.6 per cent from the previous month, while naphtha sales rose 15 per cent to 1.30 million tonnes and about 14 per cent month-on-month.
Sales of bitumen, used for making roads, rose about 47 per cent versus last year, and fuel oil increased by about 12.8 per cent last month.
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