Weak Diesel Demand Signals a Slow Rebound for Industrial India

FGE sees diesel demand down around 5% y/y in coming months
Gasoline sales surging as private vehicles favored amid virus

Trucks are parked in Delhi in September, 2020. Only around three-quarters of India’s trucking fleet is operational.Photographer: Anindito Mukherjee/Bloomberg

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By Saket Sundria and Debjit Chakraborty

January 28, 2021 at 9:00 PM UTC

Updated on

January 29, 2021 at 8:59 AM UTC

This article is for subscribers only.

It’s set to be a slow crawl back to pre-virus levels for Indian energy demand with diesel, the most-used fuel, holding back the recovery.

While demand for diesel, which accounts for around 40% of Indian fuel use in a normal year, rebounded quickly after the the world’s biggest lockdown was imposed in March, the recovery has since slowed. The annual growth rate for diesel consumption won’t get back to pre-virus levels until the year ended March 2022, said Mukesh Kumar Surana, chairman of Hindustan Petroleum Corp.