Experts had attributed the moderation in products consumption to extended monsoon, weak industrial activity and the holiday season.
Domestic consumption of petroleum products in January slipped 0.6% year-on-year (y-o-y) to 18.4 million tonnes (MT), mostly on the back of lower sales of diesel, bitumen and fuel oil. According to provisional data by the government’s petroleum planning and analysis cell (PPAC), diesel usage dipped 1.9% to 6.9 MT. In line with the government’ target of increasing the share of gas in the economy, liquefied petroleum gas (LPG) usage was up 6.1% y-o-y to 2.5 MT in January. Petroleum consumption was up 3.5% to 2.5 MT.
The requirement of furnace oil (FO) and low sulphur heavy stock (LSHS) fuel — which are predominantly used in industrial applications — in January fell 10.8% to 0.5 MT. Apart from being the fuel and feed-stock for fertiliser plants and industrial units, FO/LSHS are petroleum products which are extensively used as secondary fuel for thermal power plants.
The consumption of bitumen, which is mostly used in road construction, dropped 10.1% y-o-y to 0.6 MT. Experts had attributed the moderation in products consumption to extended monsoon, weak industrial activity and the holiday season.
In the first 10 months of the ongoing fiscal, consumption of petroleum products increased 1.4% y-o-y to 178.7 MT, mostly on the back of higher sales of petrol and LPG. Diesel consumption in the April-January period inched up only 0.6% y-o-y to 69.7 MT. FO/LSHS consumption volume fell 8.5% y-o-y to 5 MT in the same period while aviation turbine fuel and bitumen usage slipped 1.5% and 0.7%, respectively.
Domestic crude oil production fell 6% y-o-y to 2.7 MT in January. Also, the 2.6 billion metric standard cubic metre of natural gas produced in the country in the month was 8.3% lower than the production from a year-ago period. The average price of Indian basket of crude oil in January was $64.31/barrel, 8.7% higher than January 2019.