India’s demand for diesel, petrol to increase further this year: S&P Global

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NEW DELHI : India’s demand for petroleum products, particularly diesel, will spike this year on increased industrial and construction activity, as well as because of the upcoming national election that’s held once in five years, as per S&P Global Commodity Insights. Demand for petroleum products in 2024 is likely to grow by about 206,000 barrels per day, with gasoil (diesel) and gasoline (petrol) accounting for about 65% of the growth, S&P Global said in a report. In February, India’s demand for petroleum products increased by 132,000 barrels per day (bpd), or 2.4%, year-on-year, and by 256,000 bpd from January.

LPG and diesel recorded the highest year-on-year growth amid cooler weather in northern states, while diesel consumption increased in line with the receding winter and increasing mobility, S&P said. “Diesel consumption in February rose by 2.6% on-year and on-month by 126,000 bpd as winter fog receded and mobility picked up momentum. Further, with normalization of weather, industrial and construction activities saw an uptrend leading to higher gasoil use," said Himi Srivastava, senior analyst, South Asia oil markets, S&P Global Commodity Insights.

“The truck drivers’ strike in January had also led to lower demand in that month, which improved in February, showing a higher on-month increase," Srivastava said. Demand for diesel is expected to remain elevated in the first quarter, growing by 60,000 bpd year-on-year. In the second quarter, this demand is expected to increase by 75,000 bpd as harvesting activities pick up and due to the general election, she said.