Latest market data shows state-run fuel retailers, who dominate 90% of the market, selling six per cent more diesel in October than they did a year ago and petrol consumption rising four per cent year-on-year.
Simultaneously, government data for October shows power consumption rising more than 13 per cent to 110.94 BUs (billion units), driven mainly by buoyancy in industrial and commercial activities, from 97.84 BUs a year ago.
The sharp uptick in fuel and power consumption reinforces the recent projection by the International Energy Agency that India will lead the recovery in global energy demand, as reported by TOI on October 14. Prime Minister Narendra, too, echoed the view on October 26, when he told top guns of the global oil industry that, “India is set to nearly double its energy consumption over the long term.”
On a month-on-month basis, October diesel sales spiked 19% from September level but petrol demand tapered off to less than one per cent as the preference for personal vehicle appeared to be flattening. September diesel sales had jumped nearly 22 per cent over August, while petrol consumption had risen 10.5 per cent month-on-month.
October jet fuel sales too rose more than 9.11 per cent from September as the number of flights increased, but it is still about half of the year-ago period.
Predictably, consumption of LPG, or common household cooking gas, continued to rise and was 3.5% higher than the year-ago period, indicating a lot more cooking as families get into the Diwali groove.
Rising fuel sales will help refiners to ramp up operations of their units. Shrikant Madhav Vaidya, chairman of India’s largest oil refiner and fuel retailer Indian Oil, said he expected to run the company’s refineries at full steam in the next two months.
Fuel sales have also been boosted by rising car and two-wheeler sales and exports of iron ore, garments and drugs, which increased movement of goods. Car sales rose 26% and two-wheelers 12% in September from a year ago. India’s exports too rose 6%, contributing to the uptick in economic activity.