India’s Fuel Demand Picks Up After Ease in Lockdown Restrictions
As the Central Government eases nationwide restrictions after India enters lockdown 4.0 in its battle against COVID-19, the oil industry is anticipating that country’s fuel demand will rise to pre-coronavirus levels in June. Hit by the pandemic, the fuel demand in India collapsed by almost 60 percent in the first two months of the lockdown. Earlier this month, the Indian oil industry executives had estimated that demand for crude oil would take longer than expected to recover as the country is on the verge of entering the worst recession. However, industrialists believe that easing lockdowns would mean better preference of the citizens towards buying two-wheelers and small cars when social distancing becomes a mandate. This would boost the demand for gasoline and also for diesel fuel which is primarily consumed in heavy vehicle traffic, train services and farm-sector activities. Moreover, the Indian government’s decision to resume domestic flight services after a 2-month halt will further boost the demand of jet fuel in the coming months. In response to the demand rise, the country’s largest refiner Indian Oil Corporation has decided to boost capacity utilization rates by 80 per cent by the end of this month.