Diesel demand dropped 12% in August over the previous month as local lockdowns, high prices and slower economic growth stalled the recovery. Petrol sales, however, grew 5.5% month on month but both fuels remained much lower than the last year\u2019s levels.<\/p>\n
This is the second straight month of decline \u2013 diesel sales dropped 12.5% in July over June \u2013 worrying industry executives that the recovery may take longer than expected. Compared to August of last year, sales of diesel and petrol are down 22% and 8.5% respectively, as per sales data from state-run fuel retailers that control 90% of the domestic market.<\/p>\n
Jet fuel sales rose 8% from July but were down 62% compared to August 2019. Sales of liquefied petroleum gas (LPG), mainly used for cooking, grew 0.5% month on month but fell 4% from last year.<\/p>\n
Diesel makes up 40% of the country\u2019s oil demand and is considered a good gauge of economic activity due to its wider application in commercial transport and farming.<\/p>\n
\u201cLocal lockdowns have restricted movement of trucks between states and slowed down diesel consumption. Industrial and construction activity have picked up but at a slower pace,\u201d said an industry executive. High fuel prices, mainly due to steep tax hikes, too has slowed recovery, he said.<\/p>\n
Petrol is faring better than diesel as more people prefer personal vehicles to crowded public transport for health safety reasons in the middle of a pandemic, another industry executive said. At many places, public transport has been barely available, pushing people to use their personal cars and bikes.<\/p>\n
Many industry executives expect diesel demand to return to normal only next year. A weak domestic demand and oversupplied export market would keep capacity utilisation low at refineries.<\/p>\n
The run rate at Indian Oil Corp, the nation\u2019s largest refiner, has dropped to 75% from 93% in early July and its chairman, S M Vaidya, expects run rates to stay around 70-75% for the rest of the year.<\/p>\n
Rosneft-backed Nayara Energy is unsure when its 20 million tonnes a year refinery in Gujarat would again operate at full capacity as margins on most fuels are very weak, Nayara CEO B Anand said in August.<\/p>\n","protected":false},"excerpt":{"rendered":"
Diesel demand dropped 12% in August over the previous month as local lockdowns, high prices and slower economic growth stalled the recovery. Petrol sales, however, grew 5.5% month on month but both fuels remained much lower than the last year\u2019s levels. This is the second straight month of decline \u2013 diesel sales dropped 12.5% in July over June \u2013 worrying industry executives that the recovery may take longer than expected. Compared to August of last year, sales of diesel and petrol are down 22% and 8.5% respectively, as per sales data from state-run fuel retailers that control 90% of the […]<\/p>\n","protected":false},"author":39,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[133],"tags":[],"class_list":["post-371174","post","type-post","status-publish","format-standard","hentry","category-oil-gas"],"acf":[],"_links":{"self":[{"href":"https:\/\/infralive.com\/web\/wp-json\/wp\/v2\/posts\/371174","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/infralive.com\/web\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/infralive.com\/web\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/infralive.com\/web\/wp-json\/wp\/v2\/users\/39"}],"replies":[{"embeddable":true,"href":"https:\/\/infralive.com\/web\/wp-json\/wp\/v2\/comments?post=371174"}],"version-history":[{"count":0,"href":"https:\/\/infralive.com\/web\/wp-json\/wp\/v2\/posts\/371174\/revisions"}],"wp:attachment":[{"href":"https:\/\/infralive.com\/web\/wp-json\/wp\/v2\/media?parent=371174"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/infralive.com\/web\/wp-json\/wp\/v2\/categories?post=371174"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/infralive.com\/web\/wp-json\/wp\/v2\/tags?post=371174"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}