- India's fuel consumption dropped 6.5% in May due to price rise and supply issues
- Petroleum demand fell to 19.93 MT from 21.3 MT last year in the same month
- LPG use declined 20.5% and Naptha demand dropped 29.5% in May
India's fuel consumption fell by 6.5% in May due to sharp rise in prices and a supply crunch triggered by the Iran war and subsequent Hormuz blockade.
Data from the Petroleum Planning and Analysis Cell revealed that demand for petroleum products has declined to 19.93 Metric Tonne (MT) as against 21.3 MT last year during the same period.
LPG consumption fell 20.5% to 2.13 MT; while Naptha demand fell 29.5% in May. Naptha, a precursor for the production of gas products, is being diverted to increase LPG production.
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Petrol and Diesel sales saw subdued demand and rose only 3.3% and 1.5%, Aviation Turbine Fuel or ATF sales remained flat at 7.83 lakh tonnes in May as airlines limited flights.
The fall comes amid a global energy supply disruption and the on-going conflict in West Asia between Iran and United States; besides this sharp rise in bulk diesel prices and higher prices at private pumps have also led to curbing consumption.
The Hormuz blockade prompted tanker movements through the gulf to come to a near halt after the war began in late February, while since then traffic has slowly recovered, the impact is expected to linger long after the war ends.
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Crude oil prices went into a frenzy and spiralled dramatically ever since the United States and Israel launched joint airstrikes against Iran on Feb. 28, 2026.
Global benchmark brent crude has time and again crossed the landmark $120 per barrel level in the past two months as a result of, what the IEA called the largest supply disruption in the history of the global oil market.
Oil rates have been choppy ever since America's retaliation to Iran shooting its Apache helicopter down. As of 3:52 p.m. IST, Brent crude traded nearly flat at $91.38 per barrel.
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