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COVID-19 impact: Domestic Air Passenger traffic in November 2020 reached 50% of 2019 levels

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With the consistent decrease in the number of COVID-19 cases, the economic & other activities are slowly getting back to pre-COVID levels in India. However, the recovery might take a greater amount of time in sectors like Aviation. While petrol & diesel consumption is back to pre-COVID levels, domestic air traffic is still only 50% of the pre-COVID levels.

After an initial spurt in the number of COVID-19 cases during March’2020, the Government of India announced a nation-wide lockdown from the midnight of 24 March 2020. The lockdown was extended multiple times until the end of May and unlocking of various activities was carried out in different phases over the ensuing months. The lockdown, social distancing norms along with the increasing COVID-19 cases had an impact on various aspects of day-day life.  

Over the past couple of months, India has overcome the peak COVID-19 numbers with life slowly resuming back to normalcy. However, with the second wave of COVID-19 cases in Europe, the USA & other parts of the World, there are fears about a similar second wave in India. 

But what has been the actual impact of COVID-19 on various sectors? Over a period of time, we had written multiple stories analysing the impact of COVID-19 on different sectors. As more than 9 months have passed since the initial lockdown, we review the impact of COVID-19. In this story, we take a look at the COVID-19 impact on petroleum products consumption as well as domestic air travel. 

Consumption of Petrol & Diesel improve towards the end of 2020

With the fall in vehicular movement during the lockdown, the consumption of fuel, especially petrol & diesel reduced drastically. In an earlier story, we had observed that the consumption of petrol & diesel during April-June’2020 was only 1/3rd of the consumption during the same period the previous year. 

During the next quarter i.e. July-September’2020, it is observed that the consumption of petrol has picked up while that of diesel below the 2019 levels.  As per the latest information available on the Petroleum Planning & Analysis Cell (PPAC) website, it is observed that the consumption trends have further improved during October- December’2020. 

Consumption of Diesel back to 2019 levels

During the 3rd quarter of  2020-21 i.e. during Oct-Dec’2020, a total of nearly 212.27 LMT (Lakh Metric Tonnes) of Diesel was consumed. During the same period in 2019, the consumption was at 214.63 LMT. However, the consumption during Oct-Dec’2020 is less than the consumption during the same period in 2018. 

For the first time during the current financial year, the monthly consumption in October 2020 was more than the consumption during October 2019. In Oct’2020 the consumption was 69.97 LMT compared to 65.1 LMT in October the previous year. However, this could be due to lower consumption in October 2019 rather than a definitive trend since the consumption of diesel in the next two months of 2020 has been lower than the same months in 2019. 

Diesel being the main fuel consumed by most of the commercial & transport vehicles is an indicator of the state of the economy. The increasing trend indicates a gradual resumption to pre-COVID levels. 

Consumption of Petrol on an increasing trend

The consumption of petrol during the 3rd quarter of 2020-21 is higher than the same period in 2019-20. The month on month consumption of petrol was higher in 2020-21 compared to 2019-20 for the first time in September 2020.  This increasing trend sustained in the ensuing months also and in every month of the ‘Oct-Dec’ 2020, the consumption of petrol was higher than the same month during 2019-20. Overall, the consumption of petrol during October-December’2020 was 80.24 LMT, whereas it was 75.47 LMT, during the same period last year. 

The year-on-year growth during this quarter is also close to the earlier trend i.e. the consumption for Oct-Dec’2019 increased by 7.1% compared to the same period in 2018. During the same period in 2020, the corresponding increase was 6.3%. The increased consumption of petrol indicates a near-total resumption of personal vehicular movement back to the pre-COVID levels. 

Consumption of LPG is higher while Petroleum coke is still lower than last year 

The quarterly consumption of all the Petroleum related products during Oct-Dec’2020 was 542.32 LMT, while it was 548.02 LMT during the same time last year. The decreased consumption of diesel & petroleum coke has impacted the overall consumption. 

As highlighted in an earlier story, there has been no negative impact on the consumption of LPG during the lockdown. The fall in usage in commercial eateries & restaurants seems to have been compensated by the increase in consumption of domestic LPG in households. The trends remained the same in the subsequent months as well. Overall, during the first three quarters of 2020-21, LPG consumption was 205.8 LMT compared to 194.95 LMT during the same period last year. 

Among the other important Petroleum products, there is an increase in the consumption of Petroleum Coke compared to the earlier months in 2020. Since it is used in factories, its consumption indicates a resumption of production activity. However, the consumption levels are still lower when compared to last year. 

In November ‘2020, Domestic Air Passenger traffic reached 50% levels of 2019 

In the wake of the COVID-19 lockdown, domestic flights were grounded on 25 March 2020 for a period of two months. Domestic flights resumed from 25 May 2020. In an earlier story, we have highlighted that the domestic passenger traffic fell by 97.7%, 83.5%, and 82.3% during May, June & July 2020 compared to the same months in 2019. 

However, we had observed an increasing trend in the domestic air passenger traffic. In August 2020, 28.3 lakh passengers traveled in domestic flights which is nearly a quarter of the number recorded in August 2019. This increasing trend continued in the ensuing months. As per the information provided by DGCA, 63.54 lakh passengers traveled in domestic flights in November 2020 which is around 49% of the domestic passenger traffic in November 2019.  

The overall year-on-year domestic air traffic (January – November) for 2020 is 42.5% of the passenger traffic last year in 2019. Indigo Airlines, which had a nearly 48% share of the passenger traffic prior to March’2020, increased its share in the Domestic Passenger traffic to around 60% post the resumption of services in May & June 2020.  However, in recent months its market share is around 50%, indicating resumption to pre-COVID level market share. However, as the data indicates, it will be many more months before the domestic air traffic resumes to pre-COVID levels. With the threat of a possible second wave, it is to be seen of this increasing trend sustains over the next few months. 

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