Fuel demand in India decreased in January after reaching a nine-month high in December, as a result of decreased mobility brought on by the country’s widespread cold weather and a slowdown in industrial output.
Data from the Indian Oil Ministry’s Petroleum Planning and Analysis Cell (PPAC) showed on Wednesday that fuel consumption, a proxy for oil demand, was at 18.7 million tonnes in January, down approximately 4.6% from the previous month.
The PPAC data indicated that sales of gasoline, also known as gasoline, or petrol, declined 5.3% to 2.82 million tonnes in January compared to a month earlier and sales of diesel fell 7.6% to 7.18 million tonnes.
According to Refinitiv analyst Ehsan Ul Haq, the holiday season is finished and the recent cold snap may have contributed.
A private poll revealed that manufacturing in India got off to a poorer start in January, growing at its slowest rate in three months as both output and sales growth slowed.
But on an annual basis, fuel use increased by 3.3%. Sales of diesel increased by 12.6%, and those of gasoline increased by 14.2%.
As a whole, Indian oil demand is still strong, which will encourage refiners to maintain high refinery operations, according to Haq. “Car sales are still strong.”
Sales of passenger vehicles (PV) increased 22% over the previous year to 3,40,220 units in January. The Federation of Automobile Dealers Associations’ data showed that it increased by 8% from pre-COVID 2020 levels thanks to strong bookings and better supplies.
With a surge in investments, India is on track to have the fastest-growing economy in the world by 2023, which is anticipated to lead to a substantial rise in industrial activity as the central bank implements measures to combat inflation.
Sales of liquefied petroleum gas (LPG), also known as cooking gas, fell 2.1% year over year to 2.51 million, while those of naphtha fell 14.4% to 1.23 million tonnes.
During the past month, fuel oil use increased 9.1% while sales of bitumen, which is used to build roads, plummeted roughly 20%.
