India's fuel demand expected to rebound to 3.8% in FY21; diesel to witness 2.8% growth next fiscal

New Delhi: India’s fuel demand is forecast to rebound to 3.8 percent in the next fiscal starting April from its slowest pace in six years, according to oil ministry estimates.

Petroleum product demand in 2020-21 is expected to total 222.79 million tonnes, up from 216 million tonnes estimate for the current fiscal, the ministry’s Petroleum Planning and Analysis Cell (PPAC) said.

Fuel consumption in the current fiscal ending 31 March will grow by just 1.3 percent, its slowest pace in six years.

Diesel, the most consumed fuel in the country, is estimated to see a 2.8 percent growth in FY21 to 86.6 million tonnes as compared with just 0.9 percent expansion in the current financial year. The growth in diesel demand in 2019-20 is the slowest in five years.

Petrol demand is expected to slow to 8.4 percent to 33.43 million tonnes, from 9 percent. Cooking gas LPG demand is estimated to grow by 5 percent to almost 28 million tonnes in FY21.

The slowdown in fuel consumption in the current fiscal is reflective of economic growth dipping to an 11-year low of 5 percent in 2019-20.