(ET)
India’s diesel demand has slowed down sharply because of a sluggish economy and structural changes like GST-induced road transport efficiency, trucks being allowed to carry a bigger load, increased power supply and consumer preference for petrol vehicles.Diesel consumption grew barely 1.1% in the six months to September when it contracted 3.3%. Diesel makes up 40% of India’s total oil demand, which grew just 1.4% in the first half of 2019-20. In FY19, the demand was up 3% for diesel, and 2.7% for total oil.
The fall in demand has prompted Bharat Petroleum Corp to weigh exporting 200,000 tonnes of diesel a month until March – a rare step for state-run refiners as they often need to buy the fuel from private peers to serve the local market. BPCL executives do not expect diesel demand to pick up anytime soon. Indian Oil and MRPL, two other state-run refiners, have also recently increased diesel exports.
