India’s Fuel Oil Consumption Slumped in FY2024, but the Fuel Sales were Fuelled By Significant Demand

The usage of fuel oil experienced a decline of 9.7 percent year-on-year in March and declined by 6.3 percent for the fiscal year. This was contrary to the overall fuel consumption and demand outlook for the FY2024. 

As opposed to the fuel oil market synopsis for FY2024, India's fuel demand for fuel in the FY2024 showed an approximate five percent increase, driven primarily by higher sales of automotive fuel and naphtha.

According to the oil ministry, total fuel consumption, which serves as a substitute to assess the oil demand, stood at 21.09 million metric tonnes (4.99 million barrels per day) in March. This was a minor decline from the 21.22 million tonnes (5.02 mbpd) recorded in the same period last year.

However, fuel demand for the financial year ending in March 2024 reached a record high of 233.276 million tonnes (4.67 mbpd), up from 223.021 million tonnes (4.48 mbpd) the previous year.

Diesel sales, which are primarily used by trucks and commercial passenger vehicles, increased by 3.1 percent year-on-year to 8.04 million tonnes in March and were up 4.4 percent for the fiscal year. Gasoline sales in March grew by 6.9 percent year-on-year to 3.32 million tonnes and were up 6.4 percent for the fiscal year.

Bitumen sales, crucial for road construction, remained largely stable in March but saw a 9.9 percent rise for the fiscal year. Sales of liquefied petroleum gas (LPG), commonly known as cooking gas, increased by 8.6 percent to reach 2.61 million tonnes, and naphtha sales saw a significant rise of 5.5 percent to about 1.19 million tonnes, compared to the same period last March.

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According to the article by Procurement Resource, in FY2024, India witnessed a 9.7% year-on-year decline in fuel oil demand in March, with a 6.3% decrease for the fiscal year, contrasting the overall rise in fuel consumption. Despite this, the country's fuel demand increased by approximately 5%, primarily driven by higher automotive fuel and naphtha sales. Total fuel consumption slightly dipped to 21.09 million metric tonnes in March from 21.22 million tonnes the previous year.

Nonetheless, the fiscal year ended with a record high fuel demand of 233.276 million tonnes, up from 223.021 million tonnes. Specifically, diesel sales rose by 3.1% in March and 4.4% annually, while gasoline sales grew by 6.9% in March and 6.4% annually. Bitumen sales remained stable in March but saw a 9.9% increase for the fiscal year. Additionally, LPG sales surged by 8.6% to 2.61 million tonnes, and naphtha sales experienced a significant 5.5% rise to about 1.19 million tonnes.