India’s fuel demand slipped in January after hitting a nine-month peak in December, hit by lower mobility due to cold weather in parts of the country and a slowdown in industrial activity.

Consumption of fuel, a proxy for oil demand, was about 4.6% lower than the previous month at 18.7 million tonnes in January, data from Indian oil ministry’s Petroleum Planning and Analysis Cell (PPAC) showed on Wednesday.

Sales of diesel fell 7.6% in January from a month ago to 7.18 million tonnes, while sales of gasoline, or petrol, fell 5.3% to 2.82 million tonnes, the PPAC data showed.

“Festive season is over, and cold temperatures might have played a role,” said Refinitiv analyst Ehsan Ul Haq.

On a yearly basis, however, fuel consumption was up 3.3%. Sales of diesel rose 12.6%, while sales of petrol jumped 14.2%.

“Car sales remain strong… on the whole, Indian oil demand remains on the right track and will incentivise refiners to keep refinery runs high,” Haq said.

Cooking gas or liquefied petroleum gas (LPG) sales decreased 2.1% year on year to 2.51 million, while naphtha sales dipped 14.4% to 1.23 million tonnes.

Sales of bitumen, used for making roads, fell about 20%, while fuel oil use jumped 9.1% last month.
Source: Reuters