India's fuel demand expected to rebound to 3.8% in FY21

India's fuel demand is forecast to rebound to 3.8 per cent in the next fiscal starting April from its slowest pace in six years, according to oil ministry estimates.

Petroleum product demand in 2020-21 is expected to total 222.79 million tonnes, up from 216 million tonnes estimate for the current fiscal, the ministry's Petroleum Planning and Analysis Cell (PPAC) said.

Fuel consumption in the current fiscal ending March 31 will grow by just 1.3 per cent, its slowest pace in six years.

Diesel, the most consumed fuel in the country, is estimated to see a 2.8 per cent growth in FY21 to 86.6 million tonnes as compared with just 0.9 per cent expansion in the current financial year. The growth in diesel demand in 2019-20 is the slowest in five years.

Petrol demand is expected to slow to 8.4 per cent to 33.43 million tonnes, from 9 per cent. Cooking gas LPG demand is estimated to grow by 5 per cent to almost 28 million tonnes in FY21.

The slowdown in fuel consumption in the current fiscal is reflective of economic growth dipping to an 11-year low of 5 per cent in 2019-20.