In the first fortnight of September, petrol sales rose 2% from a year earlier and 7% compared to August. Diesel sales were down 5.5% year on year but rose 20% month on month, as per sales data from state-run fuel retailers who control nearly 90% of the domestic market.
This is a dramatic turnaround for fuel demand following weak recovery in July and August. Demand for diesel and petrol were down by 21% and 7.4%, respectively, in August from a year earlier.
Cooking gas consumption, which was robust even during the lockdown, has also risen 13% year-on-year and 13.5% month-on-month. Jet fuel demand has also grown 16% compared to August but is still 60% down from a year earlier due to limited domestic flyers and restrictions on international flights.
“With further easing of lockdown, more and more people are going to work and economic activity is increasing, which has boosted demand for fuel,” an oil industry executive said. “Despite a spurt in Covid cases, people appear to be less scared and eager to get on with their lives.”
Fuel demand is expected to further rise in October as the festival season approaches, the executive said, adding that falling fuel prices can further help. Petrol and diesel prices have fallen by 50 paise and one rupee per litre, respectively, this month and a sharper reduction could follow if state oil companies decide to pass on the benefits of the recent big decline in international rates.
Petrol sales have also risen partly due to people preferring personal vehicles to crowded public transport for health safety reasons in the middle of a pandemic. A sharp increase in car sales has also boosted fuel demand. Passenger vehicle sales rose 14% in August from a year earlier and two-wheeler sales gained 3%.
Local lockdowns and quarantine conditions imposed by state governments are getting lighter by the day, permitting easier movement of people and trucks between states.
Some industry executives, however, still doubt if the fuel demand recovery can sustain for long amid a rapid rise in Covid infections. “Such high infection rate has the potential to put the brakes on recovery. About one thousand people are still dying of Covid and life is far from normal for anybody,” and executive said.
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8 Comments on this Story
Kochar Bipin43 days ago
Extremely positive news - with electricity demand too shooting up sharply in first half of Sep, the economy seems to be recovering from the expensive lockdowns.
Hopefully, state governments help restaurant, hotels, malls and multiplexes which bore the brunt of the lockdown by waiving license fees and property taxes for 6 months and also provide Bank guarantees for salary expenses for next 6 months
Hemant Pisat43 days ago
Sometimes I feel that, government pays for such articles to take revenge on naysayers and fool people at large. Wonder how, half the population Children and Senior citizens are at home, without instigating and influencing any demand, on what basis this fuel consumption has recovered with obnoxious prices ?
Silchar Automobiles43 days ago
Cannot agree with the petrol sales figures.reporter should do his homework better before giving news gathering information from various sources