India's Fuel Demand Extends Recovery In June

India's fuel consumption rose in June compared with May, continuing with a gradual recovery as industrial and transport sectors reopened after a stringent lockdown, a government statement issued on Wednesday said. Fuel consumption - a proxy for oil demand in Asia's third largest economy - totalled 11.8 million tonnes in June, a decline of about 12% from a year earlier, it said. The country's fuel demand almost halved in April to the lowest since 2007 as the country came to a standstill after it went into a lockdown on March 24 to curb the spread of the coronavirus.

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Petrol sales in June rose by about 36% from May while diesel sales rose by about 20% in June

State-retailers' petrol sales in June rose by about 36% from May to about 2.04 million tonnes. Sales of diesel, which accounts for about two-fifths of the country's overall fuel sales, rose by about 20% in June compared with May to 5.54 million tonnes. However, petrol and diesel sales in June are still down by about 15% and 17.1% respectively from a year earlier.

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Oil minister Dharmendra Pradhan last week said fuel demand could normalise by the end of September. State companies Indian Oil Corp, Hindustan Petroleum Corp and Bharat Petroleum own about 90% of the retail fuel outlets in India.

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Sales of liquefied petroleum gas (LPG) rose nearly 17% in June from a year ago while jet fuel declined by 67.3% during the same period. Demand for industrial fuels such as petcoke, naphtha and marine fuel also rose in June compared to a year earlier, indicating a pick-up in industrial activity.

To meet rising fuel demand, state refiners boosted crude processing to about 85% of designed capacity compared to about 55% at the beginning of April, the statement added.