Electioneering at its peak but diesel sales slide, petrol almost flat

Source : PTI | India’s diesel sales continued to slide in May while petrol consumption was almost flat despite election campaigns for the general elections hitting a peak, preliminary data of state-owned firms showed on Thursday. Electioneering for general elections traditionally has led to a surge in fuel demand as candidates extensively use automobiles to reach voters. But the trend in sales by PSUs so far does not reflect that.

Petrol sales of three state-owned firms, which control 90% of the fuel market, at 1.367 million tonnes in the first half of May was almost the same as 1.36 million tonnes of fuel consumed in the same period last year. Month-on-month consumption however soared 11%.

Diesel sales dropped 1.1% to 3.28 million tonnes during May 1 to 15. The demand for the nation’s most consumed fuel had fallen 2.3% in April and 2.7% in March.

Besides electioneering, the summer harvest season is also the scorching summer that increases the demand for air conditioning in cars, which should lead to a rise in fuel consumption.

Also, petrol and diesel prices were in mid-March reduced by Rs 2 per litre, ending a nearly two-year-long hiatus in rate revision, which should also propel sales.

Month-on-month petrol sales were up 11% compared to 1.23 million tonnes of consumption in April 1-15. Diesel demand was 4% higher month-on-month against 3.15 million tonnes in the first half of April.

Diesel is India’s most consumed fuel, accounting for almost 40% of all petroleum product consumption. The transport sector accounts for 70% of all diesel sales in the country. It is also the predominant fuel used in agriculture sectors, including in harvesters and tractors.

Consumption of petrol during May 1-15 was 6.5% higher than in the first fortnight of May 2022, and 41.6% more than in the Covid-marred same period of 2020.

Diesel demand was up 7.1% over May 1-15, 2022, and 16.1% compared to May 1-15, 2020.

Jet fuel (ATF) sales rose 4.1% year-on-year to 314,200 tonnes during May 1-15, 2024. But, this was 9.1% lower month-on-month when compared to 345,800 tonnes in April 1-15.

Like petrol and diesel, ATF demand too is now firmly above pre-Covid levels.

ATF consumption was 16.6% more than in May 1-15, 2022 and 10.9% more than in May 1-15, 2020.

Cooking gas LPG sales fell 1.1% year-on-year to 1.21 million tonnes in May 1-15, 2024. LPG consumption was 13.5% higher than in May 1-15, 2022 and 17.3% more than in May 1-15, 2020.

Month-on-month, LPG demand fell 0.6% against 1.217 million tonnes consumption during April 1-15, the data showed.