NEW DELHI: Consumption of petroleum products grew more than 9% in February, the highest in two years, indicating an uptick in economic activity and rising car sales on the back of low oil prices.
According to provisional data gathered by Petroleum Planning and Analysis Cell, the oil ministry’s market monitor, consumption of motor fuel and other petroleum products stood a tad over 14 million tonnes in February, compared to 12.8 million tonnes a year ago. In January, consumption was estimated at 13.9 million tonnes.
Consumption in China is estimated to be growing by around 7%, which is being attributed to moderation in economic growth. At the same time, some experts reckon that the Chinese economy has become more energy efficient.
Consumption of diesel, main fuel for the transport and farm sectors, which accounts for 40% of fuel sales, rose 7.4% to 5.8 million tonnes. Petrol sales stood at 1.6 million tonnes, marking an increase of over 18%.
Increase in diesel demand is usually attributed to higher movement of goods on the back of increased industrial production, which grew 2.6% in February, and revival of construction activity. Similarly, petrol sales normally rise in tandem with lower pump prices that prop up car sales, which grew 6.8% in February.
As indicators of economic and consumer sentiment revival, the rise in diesel and petrol consumption is encouraging when compared to China.
Information and analysis available in public domain estimate a growth of 7% in China’s diesel demand in December, which is in line with the annual demand growth. China’s petrol consumption, however, grew in excess of 13% in the same month from the year-ago period on the back of a 7% rise in annual car sales in 2014 as compared to approximately 5% in India.
