Fuel consumption was never this bad at any point in last decade

Fuel consumption in the country had never been this poor at any point during the last 10 years, the first estimate of total petroleum product consumption has revealed.

As every economic activity got gummed up in the aftermath of the coronavirus lockdown, overall fuel consumption numbers in the country fell to their worst in a decade this March.

With an overwhelming majority of buses, trucks, cars, motorcycles and every other vehicle type staying off the road since the lockdown set in, fuel consumption tanked to 16 million tonnes during the month — a steep 18 per cent nosedive.

Suspension of all construction activities as well as railways and flight services (except trains/flights carrying essential goods) also contributed heavily to this fall.

Sales of petrol fell by over 16 per cent to about 2 million tonnes. The fall of diesel, the fuel that the economy primarily runs on, was even more precipitous — with sales declining by more than 24 per cent to about 5.7 million tonnes.

Down by a massive 90 per cent, the fall in the consumption of jet fuel was at a different level altogether.

The only major fuel to buck this trend was LPG. The rise in LPG consumption, by about 2 per cent, was because people remained home after the lockdown was implemented.

Refineries across countries are already curbing output in view of the record plunge in fuel sales caused by the demand decline from economic dislocations.

According to estimates by analysts at Wood Mackenzie, JBC Energy, Energy Aspects, Rystad Energy, IHS Markit and FGE, Asian refineries will reduce processing by between 2 million to 4 million barrels per day (bpd) in April. For April-June, the cuts are likely to average between 2 million to 2.7 million bpd.