Amid spiralling prices, India’s fuel demand hit 3-year high in March

Even as prices spike, the country’s fuel demand soared 4.2 per cent to a three-year high in March as petrol and diesel consumption rose above pre-pandemic levels, according to official data released on Monday.

Total petroleum product consumption in March stood at 19.41 million tonnes, the highest since March 2019, data from the Petroleum Planning and Analysis Cell of the oil ministry showed.

As the economy continued to rebound from the impact of the third wave of the COVID-19 pandemic, demand for transport fuel rose in March.

Diesel, the most used fuel in the country accounting for almost 40 per cent of all petroleum product consumption, saw the demand rising by 6.7 per cent to 7.7 million tonnes. 

Petrol sales, which crossed the pre-COVID levels a few months ago, were up 6.1 per cent at 2.91 million tonnes.

Demand for both the fuels in March was above pre-pandemic levels.

Diesel consumption was higher due to strong demand from agriculture sector as well as stocking up by consumers and petrol pumps in anticipation of a price hike.

Cooking gas (LPG) demand grew by 9.8 per cent to 2.48 million tonnes in March.

Fuel demand in the fiscal year ending March 31 was up 4.3 per cent to 202.71 million tonnes, the highest since FY20.

While auto and cooking fuel consumption rose, there was a de-growth in industrial fuel.

Petrol consumption was up 10.3 per cent to 30.85 million tonnes in 2021-22 while diesel sales were up 5.4 per cent to 76.7 million tonnes.

The demand for petrol in FY22 was the highest ever while the diesel sales were the highest since 82.6 million tonnes of consumption in 2019-20.

Consumption of LPG was up 3 per cent 28.33 million tonnes.

Jet fuel or ATF demand soared 35 per cent to 5 million tonnes but was less than 8 million tonnes consumption in the pre-pandemic year. This was mainly because full aviation services resumed only towards the end of the last month.

Petroleum coke consumption fell 9.7 per cent to 14.1 million tonnes while kerosene demand was down 17 per cent to 1.5 million tonnes in FY22.

Consumption of naphtha, which is used as a fuel in industries, as well as that of bitumen, used in road construction, were marginally higher at 14.2 million tonnes and 7.7 million tonnes, respectively.