Petrol and diesel sales by India's three state-run fuel retailers rose sharply in July as below-normal monsoon rainfall boosted fuel demand from farmers and motorists. According to preliminary industry sales data, petrol sales by Indian Oil Corp (IOC), Bharat Petroleum Corp Ltd (BPCL) and Hindustan Petroleum Corp Ltd (HPCL) climbed 9.7 per cent to 3.45 million tonnes during July, compared with 3.14 million tonnes in the corresponding period a year ago. The volume was also 15.1 per cent higher than 2.99 million tonnes sold during July 2024 and 36.1 per cent above the level recorded in the same period of 2023. Compared to June, however, petrol sales fell 1.1 per cent from 3.48 million tonnes. The strong year-on-year growth was driven by higher demand during the monsoon season as delayed rainfall led to increased fuel consumption by farmers and motorists.
Diesel sales, a key indicator of economic activity in India, rose 10.7 per cent year-on-year to 7.12 million tonnes in July from 6.43 million tonnes a year earlier. As reported by industry data, the volume sold in July was 11.5 per cent higher than in the corresponding period of 2024 and 12.7 per cent above the July 2023 consumption. On a month-on-month basis, diesel sales declined 9.2 per cent from 7.85 million tonnes in June. Diesel is India's most widely used fuel, powering freight transport, agricultural machinery and irrigation. The fuel saw higher demand as delayed monsoon rains pushed farmers to rely on diesel pumps during the peak sowing season, with farmers using diesel to run pumps to irrigate farms even as the season progressed. The month-on-month dip was also attributed to June typically seeing a seasonal bump from holiday travel during school and college breaks.
Jet fuel (ATF) sales inched up by 2.9 per cent to 659,900 tonnes during July, with volumes that were 2.3 per cent more than the consumption of 641,300 tonnes in July 2024 and 16.5 per cent more than 566,600 tonnes of July 2023. However, Liquefied petroleum gas (LPG) sales continued to fall, dropping 17.4 per cent to 2.37 million tonnes. Industry officials attributed this decline to some volumes shifting to piped natural gas since the West Asia crisis, with LPG sales having been declining since the onset of the crisis disrupted supplies and led to consumption restrictions in sectors like hotels and restaurants. Those restrictions were lifted last month, helping LPG sales rise 8.6 per cent to 2.18 million tonnes in June, even though volumes remained lower year-on-year as some industrial and commercial users have permanently switched to piped gas.
