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Thursday, November 26, 2020

Explained: Why are diesel sales finally growing since lockdown?

Diesel consumption is a key indicator of economic activity and sales by the leading state-owned OMCs grew by 27.5% over diesel sales in September.

Written by Karunjit Singh | New Delhi | Updated: November 6, 2020 12:54:38 pm
diesel prices, diesel price hike, october diesel prices, diesel price October, diesel price today, Explained Economics, Express Explained, Indian ExpressKolkata: A woman on duty at a petrol pump during the nationwide lockdown imposed to contain the spread of COVID-19, in Kolkata, Tuesday, April 14, 2020. (PTI Photo/File)

Diesel sales in India grew for the first time in October since the lockdown to curb the spread of Covid-19 was imposed in March.

October diesel sales of the three major state-owned oil marketing companies – Indian Oil Corporation Ltd., Bharat Petroleum Corporation Ltd. and Hindustan Petroleum Corporation Ltd. grew by 6.6% to 6,173 Thousand Metric Tonnes (TMT) up from 5,790 TMT in October 2019.

Petrol sales which had crossed Pre-Covid levels in September also grew by 4.0% to 2,390 TMT in October.

Diesel consumption is a key indicator of economic activity and sales by the leading state-owned OMCs grew by 27.5% over diesel sales in September.

Also read | Diesel sales recover to above pre-Covid levels in first half of October

Are diesel and petrol sales on a sustained growth trajectory?

S M Vaidya, chairman of India Oil noted in a recent press interaction that the company expected that diesel sales would reach pre-Covid levels by November and that petrol sales had recovered fully to pre-Covid levels.📣 Express Explained is now on Telegram

Petrol sales continue to benefit from an increased preference for personal mobility but the sharp growth in diesel sales may be a result of some pent-up demand from previous months which was not fulfilled, according to industry sources.

The sale of aviation turbine fuel, however, remained down by 50% in October with Indian airlines still serving far fewer passengers as compared to pre-Covid levels.

Indian airlines carried 3.94 million passengers during September, down 65.8% compared to September 2019.

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