India’s oil product demand in May was up 860,000 barrels per day or 22 per cent year-on-year from a low base in 2021, S&P Global Commodity Insights said in a note.<\/p>\n
The demand for May was some 80,000 barrel higher than its growth forecast, partly due to stronger-than-expected demand for transportation and the government’s announcement of a cut in excise duty on patrol by Rs 8 per litre and Rs 6 per litre on diesel, which provided some support for demand.<\/p>\n
On a year-on-year basis, demand growth was driven by diesel, petrol and other minor products, which were up 416,000 barrels per day, 282,000 barrels per day and 161,000 barrels per day, respectively.<\/p>\n
Kerosene\/jet fuel and fuel oil also posted positive growth, rising 67,000 barrels and 25,000 barrels, respectively.<\/p>\n
But growth was partially offset by naphtha, which fell 95,000 barrels per day, with LPG demand remaining steady.<\/p>\n
The new tax regime on petrol and diesel could result in a loss of about Rs 1 trillion to the government in annual revenue due to the lower collection, the note said.<\/p>\n
“The more immediate problem is sky-high inflation and the pressure being put on the Reserve Bank of India (RBI) to raise its policy interest rate and tighten monetary conditions,” it said.<\/p>\n
Persisting inflationary pressures could set in motion second round effects on headline retail inflation, hence, there is a need for calibrated monetary policy action to keep inflation expectations anchored and restrain the broadening of price pressures, the note added.<\/p>\n
In the near term, it expects India’s oil demand to remain robust unless fuel prices are raised sharply, which is unlikely at this state due to high inflation.<\/p>\n
“In India, the high refining margins have benefited export-oriented private refiners much more than the state-owned oil marketing companies,” it said.<\/p>\n","protected":false},"excerpt":{"rendered":"
India’s oil product demand in May was up 860,000 barrels per day or 22 per cent year-on-year from a low base in 2021, S&P Global Commodity Insights said in a note. The demand for May was some 80,000 barrel higher than its growth forecast, partly due to stronger-than-expected demand for transportation and the government’s announcement of a cut in excise duty on patrol by Rs 8 per litre and Rs 6 per litre on diesel, which provided some support for demand. On a year-on-year basis, demand growth was driven by diesel, petrol and other minor products, which were up 416,000 […]<\/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-498706","post","type-post","status-publish","format-standard","hentry","category-oil-gas"],"acf":[],"_links":{"self":[{"href":"https:\/\/infralive.com\/web\/wp-json\/wp\/v2\/posts\/498706","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=498706"}],"version-history":[{"count":0,"href":"https:\/\/infralive.com\/web\/wp-json\/wp\/v2\/posts\/498706\/revisions"}],"wp:attachment":[{"href":"https:\/\/infralive.com\/web\/wp-json\/wp\/v2\/media?parent=498706"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/infralive.com\/web\/wp-json\/wp\/v2\/categories?post=498706"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/infralive.com\/web\/wp-json\/wp\/v2\/tags?post=498706"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}