Government of India, India, Petrol, Petrol & Diesel

Data: Consumption of Petrol & Diesel down by more than 1/3rd in April-June quarter compared to 2019 while LPG consumption increases


As expected, the consumption of petroleum products witnessed a steep fall in the April-June quarter of 2020 because of the nation-wide lockdown. The consumption of Diesel & Petrol was down by more than 1/3rd compared to 2019 while the consumption of LPG increased. 

India recorded a monthly trade surplus in goods for June 2020, for the first time in 18 years. However, detailed analysis of the data reveals that that there is an overall contraction in the trade during the April – June quarter of 2020 than any real improvement in exports. The real reason for the trade surplus is contraction of trade. This period coincides with National wide lockdown imposed to mitigate the spread of COVID-19. 

In an earlier story, we observed that fall in the import of Petroleum products is one of the main reasons for the close to 50% fall in the overall imports during June’2020.

In this story we look at the trends in consumption of petroleum products during the April-June quarter, which was the reason for the fall in imports.  The data used in the story is provided by the Petroleum Planning and Analysis Cell of the Government of India. 

Consumption of Petroleum Products during April-June quarter fell to 2013 levels

The total consumption of Petroleum Products during the period April-June’2020 was 408.91 lakh metric tonnes (LMT). This is the lowest since 2013, when 404.39 LMT of Petroleum products were consumed during the same quarter.

Data indicates that over the 10-year period 2011-2020, there has been a consistent year on year increase in the consumption of Petroleum Products during the April-June quarter. For the first time in 10 years, the consumption fell in April-June’2020.  The consumption during this quarter in 2020, fell by around 1/4th compared to the consumption during the same time in 2019.  

Sharp fall in the consumption of Petroleum Products during April’ 2020

A major reason for the fall in the consumption of Petroleum products during the April-June quarter can be attributed to the sharp fall in the consumption during April’2020  corresponding to the same month in 2019. 

In April’2020, the consumption was 99.35 LMT, which is just around 54% of 183.22 LMT consumed during April’2019. The consumption in April’2020 is back to levels of April’2006 largely on account of the complete lockdown in the country. 

Though not as steep a fall as in April, the consumption for May & June’2020 are also lower than the consumption during the same months in 2019. The consumption in May & June was at 2014 and 2016 levels respectively. 

The signs of fall in consumption of petroleum products were visible in March’2020 when the consumption fell to 160.83 LMT from 195.64 LMT during March’2019. 

The consumption trends can be correlated to the timeline of imposition and relaxation of the nation-wide lockdown. 

Consumption of Diesel fell by 33% in April-June 2020 compared to the previous year 

Among various petroleum products, HSD (High Speed Diesel) has the highest consumption and traditionally forms around 40% of the total share. For the quarter April-June ‘2020, the consumption of HSD was 150.6 LMT, which is 33% less than the consumption during the same quarter in 2019 when it was 225.63 LMT. The quarterly consumption of HSD is least during these months over the past 11 years. 

The overall trajectory of consumption during this quarter is upwards over the last 10 years barring 2020. 

The fall in the quarterly consumption during this period was salvaged to an extent by the increase in May & June’ 2020 compared to that of April’2020. 

Only 32.55 LMT of HSD was consumed in April’2020 compared to that of 73.23 LMT in April’2019. Although the consumption increased in May & June’2020, it is still lower than the consumption during the same months in 2019. The numbers for May’2020 are also the least in 10-year period, while June’2020 numbers were at 2016 levels. 

The fall in consumption is also observed for March’2020, where in it was 56.5 LMT in March’2020 compared to 74.9 LMT in March’2019. 

Consumption of Petrol fell by 60% in April’2020 compared to the last year

Motor Spirit (Petrol) is another major petroleum product consumed in India. The consumption during April-June’2020 was 50.24 LMT compared to 78.35 LMT during April-June’2019. The consumption during this quarter is the lowest since 2015 when it was 53.85 LMT while 47.96 LMT were consumed in 2014. 

The numbers for April’20 indicate a sharp decline of over 60% compared to April’2019. The consumption has increased in the subsequent months with the consumption in June’2020 reaching nearly the 2018 levels. 

No fall in LPG consumption during April-June’20

Unlike Diesel and Petrol which have seen a steep fall in consumption during April-June’2020 compared to last year, the consumption of LPG has increased during this quarter compared to the same period in 2019.  

Consumption of LPG during this quarter of 2020 was recorded at 65.19 LMT, more than the  57.48 LMT recorded during this quarter in 2019. The increase in consumption during this quarter is also the highest in over 10 years.  All the three months individually recorded an increase in consumption in 2020 compared to 2019.  

Petroleum Coke consumption fell by nearly 30%

Petroleum Coke is used in certain industries as an energy alternative. India has earlier banned the import of petroleum coke in August 2018 in view of pollution concerns, but has later relaxed the restrictions.  An effect of this can be observed in the gradual fall in the consumption of Petroleum Coke since 2018. However, the reduction observed in April-June’2020 compared to the same quarter in 2019 is significant. The consumption for this quarter in 2020 was 42.05 LMT, while in 2019 it was 58.68 LMT.

The fall in consumption is especially significant  for April’20 where in it was 11.11 LMT compared to that of 22.54 LMT  in April’2019. The reduction in the consumption can be attributed to the lockdown rather than to the ban, since the consumption in months prior to April’20 was at par with the consumption figures of 2019.  

Fall in the imports of Petroleum products due to the steep fall in consumption 

The fall in the imports especially that of petroleum products in June can be correlated to the fall in the consumption of various petroleum products during the quarter of April-June’2020. 

Commercial transportation of goods as well as movement of people using vehicles has been limited during the nation-wide lockdown, which is reflected in the fall in consumption of both diesel and petrol compared to last year. The proportionately higher fall in Petroleum Coke consumption can also be attributed to the lack of industrial activity during the lockdown. 

Consumption of LPG is an exception. Though the closure of restaurants & eateries  could have reduced the consumption of commercial LPG, it is more than compensated by the increased LPG consumption in households during this period. 

These trends clearly indicate that fall in petroleum imports is due to the steep fall in consumption rather than any domestic substitution. With the lockdown norms eased across the country and the increasing trend of consumption, as observed in June’2020, the consumption of these products may reach the pre-lockdown levels in the months to come. This in-turn can result in increase of the imports, thereby tipping the trade balance towards deficit as earlier. 

Featured Image: Consumption of Petrol & Diesel


About Author

HR professional, now focused on contributing towards a positive change in the society. Passionate reader. Loves writing and photography and to narrate stories through words and pictures.

Comments are closed.