Diesel demand up 6.3%, petrol 7.5% in September on festive, freight boost

India's diesel and petrol consumption rose strongly in September 2025, aided by GST cuts, festive mobility and higher freight, though aviation fuel demand slipped

India’s diesel demand grew 6.27 per cent year-on-year (YoY) in September, driven by higher freight movement following the recent Goods and Services Tax (GST) cuts and an uptick in personal mobility during the festive season. The country had reported growth of just 0.91 per cent in diesel demand in August, while consumption rose by only 2.15 per cent in July and 1.23 per cent in June.

 

Diesel, the most consumed fuel in the country, recorded demand of 6,768 thousand metric tonnes (TMT) in September, compared to 6,369 TMT in the same month last year, according to data from the Petroleum Planning and Analysis Cell (PPAC).

 

 

The strong rise in demand for diesel, mainly used by trucks, commercially run passenger vehicles and farm machinery, follows a subdued trend in recent months due to the growing adoption of electric vehicles and compressed natural gas (CNG) in public transport.

 

Petrol consumption also rose robustly by 7.5 per cent to 3,385 TMT in September. Cooking gas demand increased 6.47 per cent last month to 2,901 TMT. However, demand for aviation turbine fuel (ATF) fell 1.32 per cent during the period.

 

Fuel consumption often mirrors the pace of economic activity. Earlier in the month, the government had cut GST rates to spur domestic demand ahead of the festive season. 

The diesel demand growth of over 6 per cent in September is the highest reported growth in the calendar year (2025).

 

Nitin Tiwari, Vice President at PhillipCapital, said, “Higher diesel demand in September can be attributed to strong festive demand and also to base effect, as sales growth was weaker last year in the same month. GST cuts by the government and several retail platforms announcing sales could have also led to increased buying sentiment, leading to rise in freight in the country.”