2 weeks Ago By Irina Slav
The growth in demand for diesel fuel in India is slowing down, the latest sales figures have suggested, with the total for October flat on the year, per a by Bloomberg citing government data. Sales of diesel fuel in the country stood at 7.64 million tons last month, the data showed, with sales over the first ten months of the year up by a modest 1.
8%, which according to the report suggests a slackening pace of demand growth for oil products overall. If confirmed, this slackening pace of growth would have implications for global oil demand prospects seeing as India is the world’s importer of crude after China and the United States. “The consumption of goods in smaller towns and cities of India has not picked up at the pace that was expected,” R.
Ramachandran, former director of refineries at Bharat Petroleum Corp Ltd., told Bloomberg. “This has in all likelihood impacted the movement of trucks that transport goods, hurting diesel demand.
Also, rains this year got extended, further adding to pressure on diesel sales for farm sector.” There is, however, another element in this change in demand. According to Kpler, diesel demand may be slowing but gasoline demand is on the rise as India’s middle class continues to expand, driving higher consumer spending, including on personal transport.
What’s more, Kpler analysts believe demand for diesel will pick up next year, to grow by 2.5%, after booking growth of 2.2% for this year.
“We observe a moderation in the growth rate compared to the post-pandemic recovery,” Kpler senior demand analyst Esteban Moreno Cots told Bloomberg. India is seen by analysts as the future biggest driver of global oil demand, set to replace China, which is electrifying its transport sector fast and expected to reach peak oil demand growth in the not too distant future. By Irina Slav for Oilprice.
com.
