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May 7, 2024

India’s April Fuel Consumption Surges by 6.1%: Oil Ministry Report Reveals

India’s fuel consumption witnessed a significant surge of 6.1% year-on-year in April, according to the latest data from the Petroleum Planning and Analysis Cell of the oil ministry. This surge in fuel consumption is indicative of the country’s robust oil demand, as India maintains its position as the world’s third-biggest oil importer and consumer.

Prashant Vasisht, Vice President and Co-head of Corporate Ratings at ICRA, noted, “The rise in total fuel consumption in April can be attributed to the increased activity in the run-up to elections across the country.” Vasisht also emphasized that Indian fuel demand is expected to continue growing by 3% to 4%, driven primarily by increased demand for petrol and diesel, alongside noteworthy growth in air travel.

Total fuel consumption in April reached 19.86 million metric tons (4.85 million barrels per day), up from 18.71 million tons in the same period last year. However, on a monthly basis, demand saw a decline of 5.8% from March, where consumption stood at 21.09 million metric tons.

The data also reveals a mixed trend in the consumption of different fuel types. Diesel sales, primarily used in trucks and commercial vehicles, rose by 1.4% year-on-year to 7.93 million tons in April. Conversely, gasoline sales surged by 14% from the previous year, totaling 3.28 million tons.

Demand for bitumen, used in road construction, experienced a decline of over 5% annually. On the other hand, sales of cooking gas (liquefied petroleum gas or LPG) rose by nearly 10%, reaching 2.36 million tons. Naphtha sales also saw an increase of 3.9% to about 1.16 million tons compared to the previous April.

However, fuel oil use witnessed a significant decrease of more than 16% year-on-year in April, reflecting shifting consumption patterns.

In the context of India’s economic outlook, the country’s GDP is projected to expand by 6.5% this fiscal year, making it the fastest-growing economy among major peers in Asia. Despite a marginal slowdown in the growth of the manufacturing sector in April, strong demand has led firms to increase raw material purchases at a near-record pace.

This surge in fuel consumption not only reflects India’s economic activities but also underscores the country’s ongoing efforts to meet its energy demands and sustain its economic growth trajectory. With the manufacturing sector showing resilience and steady demand for key fuel types, India’s energy landscape remains dynamic amidst changing global trends.

Jhumpa Lahiri

Jhumpa Lahiri

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