Festival season demand expands India’s diesel sales for first time in eight months

The rebound in diesel demand is crucial for ramping up crude processing by Indian refiners after fuel consumption was crushed by a strict lockdown in late March to check the spread of Covid-19 pandemic.
Mid-October with main festivals like Dussehra and Diwali lined up is the peak demand season and, as a result, a busy time for diesel-guzzling trucks hitting the roads to deliver everything from clothes to refrigerators.(Yogendra Kumar/HT file photo)
Mid-October with main festivals like Dussehra and Diwali lined up is the peak demand season and, as a result, a busy time for diesel-guzzling trucks hitting the roads to deliver everything from clothes to refrigerators.(Yogendra Kumar/HT file photo)
Published on Nov 01, 2020 06:52 PM IST
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ByBloomberg | Posted by Deepali Sharma

Diesel sales in India clocked its first year-on-year gain since February as annual festivals boosted demand for the country’s most-consumed fuel.

Sales by India’s top three fuel retailers rose 6.1% from a year earlier in October to 5.76 million tons, according to officials with direct knowledge of the fuel sales data.

The rebound in diesel demand is crucial for ramping up crude processing by Indian refiners after fuel consumption was crushed by a strict lockdown in late March to check the spread of Covid-19 pandemic. Indian Oil Corp., the country’s biggest refiner, has boosted its run rates to 93% of capacity and is hoping to reach 100% in a couple of months, Chairman Shrikant Madhav Vaidya said on Oct 30.

The nation’s two main festivals -- Dusshera and Diwali -- started mid-October and celebrations will extend for more than a month. This is the peak demand season and, as a result, a busy time for diesel-guzzling trucks hitting the roads to deliver everything from clothes to refrigerators. Besides the festival demand, crop harvesting activities also boosted consumption for the industrial fuel.

The growth in diesel also outpaced gasoline sales that rose 4.2% from a year earlier to 2.22 million tons, according to the officials who asked not to be named as they’re not authorized to speak to the media. Liquefied petroleum gas posted year-on-year gain of 3.7%, but aviation turbine fuel sales volumes were at half of last year’s levels, the official said.

Indian Oil, Bharat Petroleum Corp. and Hindustan Petroleum Corp., which account for more than 90% of the nation’s fuel sales, declined to comment.

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Sunday, November 28, 2021