Monsoon dampens petrol, diesel sales

New Delhi: Petrol and diesel sales fell in the first half of June as the arrival of monsoon cut demand in the agri sector and reduced vehicular movement, preliminary industry data showed.

Demand for diesel, the most consumed fuel in the country accounting for about two-fifths of the demand, fell 6.7 per cent to 3.43 million tonne in June 1-15 compared to the year-ago period. Sales of diesel had soared 6.7 per cent and 9.3 per cent in April and May, respectively as agriculture demand picked up and cars yanked up air-conditioning to beat summer heat.

Month-on-month sales were up 3.4 per cent when compared with 3.31 million tonne of diesel consumed in May 1-15. Petrol sales dropped 5.7 per cent to 1.3 million tonne during the first half of June 2023 when compared with the same period last year. Sales were down 3.8 per cent month-on-month, the data showed. Petrol and diesel sales had been on the rise since the second half of March on the back of a pick-up in industrial and agriculture activity. But the arrival of monsoon has cooled temperatures and reduced demand for running diesel gensets to irrigate fields as well as cut down consumption in tractors and trucks in the first half of June.

Consumption of petrol during June 1 to 15 was 44.2 per cent more than Covid-marred June 2021 and 14.6 per cent more than pre-pandemic June 1-15, 2019. Diesel consumption was up 38 per cent over June 1-15, 2021 and 8.8 per cent higher than in the first half of June 2019. With the continued opening of the aviation sector, India's overall passenger traffic at airports inched closer to pre-Covid levels.

Reflecting the trend, jet fuel (ATF) demand rose 2.6 per cent to 290,000 tonne during June 1 to 15 when compared to the same period last year. It was 148 per cent higher than in the first half of June 2021 but 6.8 per cent lower than pre-Covid June 1-15, 2019. Month-on-month sales fell 3.9 per cent when compared with 301,900 tonne in May 1-15, 2023. The Indian economy has gained pace with a pick-up in government and private capital spending. Manufacturing too has picked up while the services sector has been robust.

The country's oil demand during the last few months was supported by strong industrial activity, industry officials said. Cooking gas LPG sales were down 1.3 per cent year-on-year to 1.14 million tonne in June 1-15. LPG consumption was 3.3 per cent higher than in June 2021 and 26.7 per cent more than pre-Covid June 1-15, 2019.