Saturday, July 20, 2024

Extreme heat melts diesel demand, sales drop 4% in June

NEW DELHI, JUNE 17: India’s diesel demand slumped in June as extreme heat conditions in parts of the country curtailed travel, preliminary data of state-owned firms showed on Monday.
Fuel sales, which traditionally surge during elections, have defied the trend this year, falling month after month. And the decline has now extended even after the end of the general elections.
Petrol sales of 3 state-owned firms, which control 90% of the fuel market, at 1.42 million tonnes in the first half of June was almost the same as 1.41 million tonnes of fuel consumed in the same period last year.
Month-on-month consumption dropped 4.6%. Diesel sales dropped 3.9% to 3.95 million tonnes during June 1 to 15 when compared with the year-ago period.
The demand for the nation’s most consumed fuel had fallen 2.3% in April and 2.7% in March.
In May it fell 1.1%.
Besides electioneering, the summer harvest season as also the scorching summer that increases the demand for air conditioning in cars, should have led to a rise in fuel consumption.
However, this year has defied the trend.
Petrol and diesel prices were reduced by Rs 2 per litre in mid-March, ending a nearly 2-year-long hiatus in rate revision, which should have also propelled sales.
Month-on-month petrol sales fell 3.6% compared to 1.47 million tonnes of consumption during May 1-15. Diesel demand was flat month-on-month against 3.54 million tonnes in the first half of May.
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 June 1-15 was 4.6% lower than in the first fortnight of June 2022, and 28.1% more than in the COVID-marred same period of 2020.
Diesel demand slumped 10.5% over June 1-15, 2022, and 14% higher compared to June 1-15, 2020.
Jet fuel (ATF) sales rose 2.3% year-on-year to 331,000 tonnes during June 1-15, 2024.
But, this was 4.5% lower month-on-month when compared to 346,500 tonnes in May 1-15, the data showed.
Like petrol and diesel, ATF demand, too, is now firmly above pre-COVID levels.
ATF consumption was 10.1% more than during June 1-15, 2022, and 6.1% more than in June 1-15, 2020, as per the data.
Cooking gas LPG sales were up 0.1% year-on-year to 1.24 million tonnes in June 1-15, 2024.
LPG consumption dropped 0.9% as compared to June 1-15, 2022 and was 32% more than June 1-15, 2020.
Month-on-month, LPG demand fell 5.2% against 1.3 million tonnes consumption during May 1-15, the data added. (PTI)