The nation’s gas demand slumped in Could to its lowest since August final yr with a second COVID-19 wave stalling mobility and muting financial exercise on the earth’s third largest oil shopper. Oil demand fell 11.three per cent to 15.11 million tonnes in comparison with the earlier month and was down 1.5 per cent from a yr earlier, knowledge from the Petroleum Planning and Evaluation Cell (PPAC) of the Oil Ministry confirmed on Wednesday.
“It is primarily due to the lockdowns, nevertheless it’s very tough to isolate the affect on demand as even excessive oil costs may type of pinch a bit bit when it comes to demand recovering extra slowly,” mentioned Prashant Vashist, Vice President and Co-Group head at ICRA.
Indian state refiners’ every day petrol and diesel gross sales declined by a few fifth in Could from a month earlier as a result of pandemic, however greater gas costs have additionally sapped consumption. The nation’s whole coronavirus infections crossed 27 million and hit report every day ranges final month, placing the federal government “on a conflict footing” to include the unfold.
Nonetheless, as instances decline, elements of the nation are anticipated to ease motion restrictions, which may increase demand. “All people is anticipating the restoration shall be quicker this time… so in one other quarter or so in all probability we must be someplace near pre-pandemic ranges,” Vashist added.
Diesel consumption, a key parameter linked to financial development and which accounts for about 40 per cent of general refined gas gross sales in India, rose 0.7 per cent year-on-year, however dipped 17 per cent from the earlier month to five.53 million tonnes. Gross sales of petrol, elevated by 12.four per cent from a yr earlier, however fell about 17 per cent month-on-month to 1.99 million tonnes.