India’s petrol and diesel consumption surged to its second highest levels on record in March 2024, while jet fuel usage hit an all time high reflecting on the country’s fast expanding industrial base and growing demand for personal and commercial mobility.

Besides, higher consumption also points to the growing air and road travel as political parties and politicians criss-cross the country for campaigning ahead of the elections to Lok Sabha, which commences on April 19 and concludes on June 1.

According to the Petroleum Planning and Analysis Cell (PPAC), diesel consumption in the world’s third largest fuel guzzler rose 8 per cent M-o-M and 3 per cent Y-o-Y to 8.04 million tonnes (MT), the second highest in FY24 as well as on record. The usage of the fuel—mainstay of the transport sector—rose to a record 8.22 MT in May 2023.

Similarly, petrol consumption grew 10 per cent M-o-M and 7 per cent Y-o-Y to 3.32 MT. This is also the second highest for the last financial year as well as the second highest so far. Usage of motor spirit—a personal mobility favourite—hit its highest in May 2023 (3.35 MT).

In a sign that a growing number of people are opting for air travel, the world’s fastest growing air passenger market consumed 758,000 tonnes of jet fuel—the highest on record. It was also higher by 8 per cent M-o-M and 10 per cent Y-o-Y.

Analysts and market players attribute the rising consumption, a proxy for oil demand, to growth in personal and commercial mobility. Besides, March is the month during which industrial and construction activities picks up pace.

Historically, March also witnesses heightened activity due to financial year closing, which also reflects in higher sales of auto fuels.

An official with a refiner said that campaigning by the political parties for the upcoming Lok Sabha elections is also resulting in higher sales of auto and jet fuels. “Politicians and party workers are holding rallies across the country leading to more demand for choppers, small aircrafts, cars, SUVs and buses. This will continue right up till June and will reflect in sales,” he added.

For FY24, the consumption of diesel and petrol at 89.65 MT and 37.22 MT, respectively, is an all time high. However, usage of jet fuel at 8.25 MT is still below pre-pandemic levels. Jet fuel consumption in FY19 stood at 8.30 MT.

The total consumption of refined petroleum products in FY24 rose by 4.6 per cent Y-o-Y to 233.276 MT, which is also an all time high.

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