Diesel sales in India declined for the second consecutive month in September due to a weak demand caused by rains and reduced industrial activity in certain parts of the country, preliminary data from state-owned firms revealed. The data indicated that diesel sales of three state-owned fuel retailers declined on a year-on-year (YoY) basis in the first half of September, however, petrol sales increased marginally.
The data revealed that diesel consumption declined by 5.8 per cent to 2.72 million tonnes between September 1-15, compared to the same period a year earlier. Notably, diesel is the most consumed fuel in India accounting for almost two-fifths of the demand, reported PTI. Diesel consumption in the first half of August also witnessed a similar fall. Diesel sales in September inched up by 0.9 per cent, compared on a month-on-month basis to the first half of August which reports sales of 2.7 million tonnes of diesel.
The report stated that generally, monsoon months witness a reduction in diesel sales on account of demand in the agriculture sector weakened by rains. Further, rains also slow down vehicle movements. Meanwhile, April and May reported an increased diesel consumption, up by 6.7 per cent and 4.3 per cent respectively. This increase was attributed to a revival in agricultural demand and vehicles requiring air-conditioning to survive the summer heat.
The onset of monsoon in the second half of June saw demand for diesel weakening. It declined in the first half of July but picked up again in the latter half of the month.
At the same time, the first half of September reported an increase of 1.2 per cent in petrol sales, which stood at 1.3 million tonnes, compared with the same period a year earlier. While consumption reduced by 10.5 per cent in the first two weeks of July, it revived in the latter half of the month. August reported a decline of 8 per cent in consumption in the first half. However, sales for the first half of September picked up by 8.8 per cent on a month-on-month basis, the data revealed.
The data noted that the Indian economy has grown at a strong rate and it’s performance has potentially surpassed major economies in the first half of the current year. This growth has contributed to the demand for fuel as well.
Notably, the first half of September witnessed an increase of 29.5 per cent in petrol consumption, compared to the pandemic-affected first half of September 2021. The consumption in the period was 20.8 per cent more than that consumed in September 2019. Meanwhile, diesel consumption increased by 26 per cent compared to September 1-15, 2021, and 36.4 per cent against the same period in 2019.
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