Fuel demand to expand 10% next year as Covid intensity reduces: Govt

The country’s fuel consumption is expected to shrug off the Covid-19 pandemic hit in the next fiscal year (FY22) and rise 9.85 per cent, according to the Petroleum Planning and Analysis Cell (PPAC) of the oil ministry. The forecast, however, trails the initial estimates.

Demand for diesel is expected to reach 83.68 million tonnes (mt) in FY22, from 73.86 mt in FY21 — an increase of 13.30 per cent.

This optimism is on the back of a steep economic recovery, resulting in more heavy (and commercial) vehicles such as trucks plying on the roads. There is a similar growth estimate for petrol consumption that is forecast to hit 31.35 mt in FY22, a rise of 13.32 per cent from 27.67 mt in FY21. This reflects increased personal mobility (two and four wheeler vehicles) as the Covid-19 pandemic induced lockdowns are expected to completely cease next year.