Petrol sales unchanged, diesel demand dips amid Indian election campaigns
Despite the peak of the election campaign in India, May 2024 saw a sluggish demand for petrol and diesel. Data from state-owned oil marketing firms revealed that petrol sales remained almost flat, while diesel sales continued to slide. This year's trend deviates from the norm where fuel sales usually surge during election campaigns, due to extensive automobile use by candidates.
Petrol sales mirror previous year's figures
The three state-owned firms, controlling 90% of the local fuel market, reported petrol sales nearly identical to the previous year. In the first half of May 2024, these firms sold 1.367 million tons of petrol, closely matching the 1.36 million tons sold during the same period in 2023. However, there was an increase of 11% on a month-on-month basis in petrol sales during the first half of May.
Diesel demand continues to decline
Diesel sales, however, experienced a decline in demand. India's most consumed automotive fuel saw a drop of 1.1% to 3.28 million tons during the first half of May 2024. This follows a trend of decreasing demand for diesel with a drop of 2.3% in April and 2.7% in March, despite being amid an election campaign period, typically associated with increased fuel consumption.
Heatwave and fuel price reduction fail to boost sales
Interestingly, the slump in fuel sales occurred despite a heatwave hitting several parts of India in early May. Typically, such weather conditions lead to increased fuel consumption due to the extensive use of car air conditioning systems. This sluggish performance also coincided with a reduction in fuel prices; petrol and diesel prices were cut by ₹2 per liter in mid-March 2024 after nearly two years without revision.
