India's Fuel Consumption Rises in June 2023, Driven by Economic Growth and Tourism

India's Fuel Consumption Rises in June 2023, Driven by Economic Growth and Tourism

India's Fuel Consumption Rises in June 2023

India's fuel consumption increased by 2.6% year-on-year in June 2023, reaching 19.99 million metric tonnes. This represents an increase from the 19.48 million tonnes consumed in June 2022. The data, released by the Petroleum Planning and Analysis Cell of the oil ministry, provides insights into the country's oil demand.

Several factors contributed to the rise in fuel consumption. Prashant Vasisht, vice president and co-head of corporate ratings at India Credit Rating Agency (ICRA), attributed the increase to solid economic growth and increased tourist activity compared to the previous year. Additionally, improvements in the power sector and increased agricultural activity led to a reduced reliance on diesel.

While fuel consumption increased year-on-year, it declined by 3.5% compared to May 2023, when consumption reached 20.72 million metric tonnes.

Diesel consumption, primarily used by trucks and commercial passenger vehicles, decreased by 5% month-on-month to 7.98 million tonnes in June. However, it remained 1% higher compared to June 2022.

Gasoline sales rose by 4.6% year-on-year to 3.30 million tonnes, despite a 4.8% decline from May levels.

Demand for bitumen, used in road construction, increased by more than 4% annually.

Cooking gas (liquefied petroleum gas) sales rose by 3.2% to 2.31 million tonnes, while naphtha sales gained by 1.4% to approximately 1.07 million tonnes compared to June 2022.

Fuel oil use also witnessed a near 5% year-on-year increase in June.