Fuel demand in India hit its highest level in at least 24 years in February amid a boost in the country’s industrial activity by cheap Russian oil, latest official data revealed.
The country’s fuel consumption rose by more than 5 percent to 4.82 million barrels pre-day – or 18.5 million tonnes – in February, its 15th consecutive year-on-year rise.
The demand was the highest recorded in data compiled by the Indian Oil Ministry’s Petroleum Planning and Analysis Cell (PPAC) from 1998, Reuters reported.
Viktor Katona, lead crude analyst at Kpler said that the strength highlights a combination of profitable refining from record Russian crude imports in February, total utilisation for primary distillation across India, and still-robust domestic consumption.
In March, the demand will be 5.17 million barrels per day (bpd) and then the seasonal monsoon-driven slowdown will lead to it dropping to 5 million bpd in April-May, Katona forecasted.
Fuel sales jump in Feb
The data also showed that sales of petrol rose 8.9 percent year-on-year to 2.8 million tonnes in February, while diesel consumption climbed 7.5 percent to 6.98 million tonnes.
Sales of jet fuel jumped more than 43 percent to 0.62 million tonnes, the Reuters report said.
Alan Gelder, VP Refining, Chemicals and Oil Markets at Wood Mackenzie stated that the strongest demand growth rate is projected to be in jet fuel in 2023, followed by gasoline and then diesel/gas oil.
While fuel sales data showed total volumes of gasoline (motor spirit) and diesel (HSD) fell in February relative to January, they grew strongly on a daily consumption basis as February is a short month, Gelder noted.
Sales of cooking gas – or liquefied petroleum gas (LPG) – however slipped by 0.1 percent to 2.39 million tonnes in the month.
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