In an indication of a fast-recovering economy post pandemic, India’s fuel demand, except ATF, has returned to pre-Covid levels.
Fuel sales had fallen by a record 45.8 per cent in April last year when a nationwide lockdown was imposed to check the spread of coronavirus infections. Demand started to recover with the easing of lockdown restrictions, with petrol returning to normal growth first and now diesel too is back at pre-Covid levels.
“Expect for ATF, we have touched normal demand,” Indian Oil Corporation (IOC) Chairman Shrikant Madhav Vaidya said in a media briefing. “We are back on track.”
While petrol sales had reached pre-Covid levels a few months back, diesel was up 7.4 per cent year-on-year in the first half of March.
With airlines not operating all flights, ATF sales remain below normal.
This is the first annual rise in petrol sales since October. ATF sales, which fell by more than 80 per cent in the aftermath of the lockdown, was down 36.5 per cent in the first half of March.
India’s economy returned to positive growth territory in the fourth quarter of 2020 as its real GDP expanded by 0.4 per cent year-on-year after two-quarters of contraction.
Crude oil suppliers group OPEC’s monthly oil report last week forecast a 13.6 per cent jump in India’s oil demand in 2021 to 4.99 million barrels per day.
India’s oil demand had fallen 10.54 per cent in 2020 to 4.40 million bpd from 4.91 million bpd in 2019.
The recent positive developments in industrial activities will result in industrial fuels being the backbone for oil demand growth in 2021, with a healthy rebound for transportation fuels providing further support, it said adding the aviation sector will remain under pressure throughout 2021 and will also be a major source of uncertainty.
In 2020, India’s GDP contracted by 7 per cent, but it is forecast to grow by 9 per cent in 2021.
“Following the 0.4 per cent growth registered in 4Q20, India’s was one of the few major economies to post growth in the quarter as lockdowns eased, and this rebound is expected to continue as consumption manufacturing activity rise,” the OPEC report said