India’s fuel demand plunges in May 21 on COVID-19 lockdowns

• Indian state refiners’ daily gasoline and gasoil sales declined by about a fifth in May 21 from a month earlier as lockdowns to curb the second deadly wave of COVID-19 hit industrial activities and consumption, preliminary data showed on 1 Jun 21.
• Daily gasoline sales in May 21 fell by about 19% m/m while diesel consumption, which is linked to industrial activity and accounts for over two-fifths of India’s fuel demand, fell by 19.9%, data compiled by state refiners showed.
• Rising retail prices of gasoline and gasoil along with lockdowns hit fuel demand in May 21, said an official at one of the refiners. He hoped fuel consumption would soon start improving as the number of infections is declining and states are gradually easing restrictions.
• However, fuel prices continue to climb with a recent hike at the end of May 21. Fuel prices rose by INR0.028 per litre on 31 May 2021. The flat hike applied to both petrol and diesel prices, which in turn rose to new highs of INR100.48 per litre and INR 92.45 per litre respectively in Mumbai.
• A recent survey carried out between 23-27 May 21 found that around 47% of people hold the Central government responsible for the rise in petrol and diesel prices, as per the ABP-C Voter Modi 2.0 Report Card.
• Indian fuel demand had recovered to near pre-pandemic levels in Mar 21 but has been sliding since Apr 21 owing to a resurgence in infections, prompting Indian refiners to cut crude processing and imports.
• Consultancy Rystad Energy expects India’s refinery runs to fall to 4.2 million barrels per day (bpd) during May 21, a 600,000-bpd decrease from its previous forecast.
• “After showing surprising resilience during Apr 21, we expect India’s refinery runs to drop by 700,000 bpd m/m in May 21 as refiners will have to adjust throughput to respond to the imminent demand destruction,” Rystad said.
• Domestic fuel sales by state retailers, however, were higher on an annual basis owing to base effects.

External Link : https://www.reuters.com/world/india/indias-fuel-demand-plunges-may-covid-19-lockdowns-data-2021-06-01/

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