Speaking to reporters after the company's annual general meeting, Chairman Shrikant Madhav Vaidya said petrol and diesel sales have seen "phenomenal improvement in the first half of September" and if the trend continues demand will return to pre-COVID levels within a quarter.
Fuel sales had fallen by a record 45.8 per cent in April when the nationwide lockdown was in place to check coronavirus infection. (File image)
Indian Oil Corp, the country’s largest oil firm, expects petrol and diesel demand to return to pre-pandemic levels faster than previously anticipated but it is reviewing refinery expansion plans in view of permanent demand destruction in some sectors, a top company official said on Monday.
Speaking to reporters after the company’s annual general meeting, Chairman Shrikant Madhav Vaidya said petrol and diesel sales have seen “phenomenal improvement in the first half of September” and if the trend continues demand will return to pre-COVID levels within a quarter.
However, jet fuel demand, which has been pummelled by stopping of flights and only restricted operations even after the lockdown was lifted, will be difficult to predict.
“IOC’s diesel sales rose 22 per cent month-on-month in the first fortnight of September but was down 9 per cent year-on-year whereas petrol sales are up 9 per cent month-on-month and registered growth of 1 per cent vis-a-vis September 2019,” he said.
With several states imposing local lockdowns, it was previously predicted that petrol and diesel sales will reach pre-COVID levels only in the first half of 2021.
Fuel sales had fallen by a record 45.8 per cent in April when the nationwide lockdown was in place to check coronavirus infection. Lockdown restrictions have been progressively eased beginning May but now several states are imposing lockdown to curb record daily infection rates.
Vaidya said the IOC is reviewing the supply-demand scenario to configure its refinery expansion plans.
According to the latest BP’s world energy outlook, India will continue to see demand for petroleum products. “The demand is not destroyed (due to pandemic) but deferred,” he said.
“But we are reviewing refinery expansion plans and would prefer brownfield expansions over grassroots expansions,” he said.
To protect its margins and hedge against volatile oil market, IOC will be focusing more on petrochemical projects.
“As a long-term strategy, we plan to enhance our petrochemicals integration to about 14 to 15 per cent” by 2030 from single-digit number currently, he said.
Also, IOC is focussing on EV space through not just EV charging stations but also a battery-swapping facility for the EVs.
“In the long run, IOC intends to develop fuel cells and indigenous hydrogen storage solutions for promoting green mobility,” he said.
While petroleum fuels still have a long way to go, transition fuels will have a prominent place in IOC’s growing bouquet of energy offerings, he said. “And our retail outlets of the future will be ‘energy pumps’ that offer a wide assortment of cleaner, greener and more efficient fuel options.”