India’s overall fuel demand fell 2.8% year-on-year to 18.61 million metric tonnes in August, mainly due to a sharp decline in LPG and naphtha consumption. 

However, petrol and diesel demand remained strong, showing continued activity in transport and the broader economy. Data released by the Petroleum Planning and Analysis Cell (PPAC) showed mixed trends across fuel categories.

Petrol consumption increased 8.2% YoY to 3.84 million tonnes in August. Diesel, which accounts for a major share of India’s fuel consumption, also rose 6.8% to 7.02 million tonnes. The increase in both fuels points to stronger mobility and demand from road transport despite the decline in overall fuel consumption.

The sharpest decline came from LPG sales, which fell 17.2% to 2.35 million tonnes. Naphtha consumption also dropped 22.3% to 0.83 million tonnes. These declines were large enough to offset the increase in petrol and diesel demand and pull total fuel consumption lower during the month.

Some industrial and infrastructure-related fuel demand remained positive. Bitumen sales rose 19.8% in August, pointing to continued activity in road construction and infrastructure projects. Fuel oil consumption also increased 4.8% during the month.

The latest data comes at a time when global crude markets are facing fresh pressure from rising tensions in West Asia. Brent crude was approaching $100 a barrel, raising concerns over India’s import bill and the impact of higher energy costs on inflation. India imports a large share of its crude requirement, making domestic fuel demand and global oil prices important factors for the economy.

The fuel data also shows a changing consumption pattern. While petrol and diesel demand continues to grow, alternative-fuel vehicles such as CNG, hybrids and EVs accounted for nearly 42% of passenger vehicle sales in August, surpassing petrol-powered vehicles for the first time.

Overall, the August figures present a mixed picture, with strong transport fuel consumption offset by weakness in LPG and industrial fuel segments.

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