India's petrol, diesel demand at 11-month high in Dec

India's fuel demand rose for the fourth straight month in December as the resumption of economic activity took consumption to 11-month high, but it was about 2 per cent lower than pre-Covid levels.

The total demand for petroleum products in December 2020 fell to 18.59 million tonnes from 18.94 million tonnes a year back, according to provisional data published by the oil ministry's Petroleum Planning and Analysis Cell.

Fuel consumption, however, posted a month-on-month increase for the fourth straight month, helped by reviving transportation and business activity.

India had consumed 17.86 million tonnes in November.

The consumption in December was the highest since February 2020.

While petrol had reached pre-Covid levels in September, diesel consumption returned to normal in October. However, its demand fell again in November and now in December.

Diesel demand, which had soared 7.4 per cent year-on-year in October, dropped 6.9 per cent in November and by 2.7 per cent in December to 7.18 million tonnes. Month-on-month, the demand slightly improved from 7.04 million tonnes.

Fuel demand had snipped by 49 per cent in April after a nationwide lockdown, imposed to curb the spread of coronavirus, shut industries and took most vehicles off-road.

The 69-day nationwide lockdown was followed by local and state-level restrictions. The curbs have eased only slowly and in phases, while localised restrictions in containment zones remain.

The onset of the festive season has fuelled a rise in consumption, but the public transport is not back to normal levels yet, as schools and educational institutions continue to remain shut in most parts of the country.

Demand for naphtha, which is used as industrial fuel for generating electricity and producing petrochemicals, fell 2.67 per cent to 1.23 million tonnes in December.

But, bitumen, used in road construction, consumption jumped by 20 per cent to 7,61,000 tonnes.

LPG - the only fuel that showed growth even during the lockdown period on the back of the government giving free cooking gas to the poor - was up 7.4 per cent at 2.53 million tonnes.

Aviation turbine fuel or ATF sales fell 41 per cent to 4,28,000 tonnes as most airlines are yet to resume full operations. On a month-on-month basis, it improved by 13.5 per cent.