India's fuel demand slips in Nov from 4-month peak, hit by reduced travel

India's fuel consumption in November fell after hitting a four month peak in the previous month, hit by reduced travel in the world's third biggest oil consumer as a festive boost fizzled out.

Total consumption in November, a proxy for oil demand, fell by 2.8 per cent to 18.72 million tonnes from 19.26 million tonnes in October, the data from the Indian oil ministry's Petroleum Planning and Analysis Cell (PPAC) showed.

It was down about 2 per cent compared with the same period a year earlier.

"Consumption increased in October due to agricultural demand and as people traveled during the festive season. November is seeing a dip as people reverted to normal activity," said Prashant Vasisht, vice president and co-head, corporate ratings at ICRA.

 

Sales of diesel, mainly used by trucks and commercially-run passenger vehicles, decreased by 1.4 per cent month-on-month to 7.53 million tonnes.

"Diwali holidays generally ramp up domestic consumption patterns as mobility perks up, however disappointing diesel demand has marred India's stellar performance so far this year," said Viktor Katona, lead crude analyst at Kpler.

"The immediate outlook is for gasoline demand to drop back from Diwali peaks and trend around 850,000 barrels per day over the next 2-3 months."

Sales of gasoline in November were 0.4 per cent lower than the previous month at 3.13 million tonnes.

Sales of bitumen, used for making roads, fell by 9.4 per cent from October, while fuel oil use declined by 1.3 per cent in November.

Cooking gas, or liquefied petroleum gas, sales decreased by 0.4 per cent to 2.49 million tonnes, while naphtha sales fell by 7.9 per cent to about 1.03 million tonnes, the data showed.