Covid wave spooks India’s fuel, power demand in May

NEW DELHI: The second Covid wave spooked India’s fuel and power demand in May as lockdown across states confined people to their homes and curtailed economic activities.
Consumption of diesel, a proxy for economic activities, slid more than 16% from April and was down 28% from May 2019, the pre-pandemic year when consumption was ‘normal’. Petrol sales, consistently growing since the unlock process began last year, dropped over 17% from a month ago and 30% from the same period of 2019, market data shows.
Power consumption declined almost 7% to 110 BU (billion units) from 118 BU in April and was 8% lower than May 2019 at 120 BU. Primarily lockdowns throttled demand. But a cooler-than-usual May and outages following cyclone Tauktae on the west coast and Yaash on the east coast added to the consumption loss.
But Hindustan Petroleum chairman M K Surana believes the situation is not as bad as May 2020 and “will improve hereon”.
“The Covid caseload is declining, we are seeing localised easing of some restrictions and there are upsides to the vaccination pace. In the past, we saw demand rise sharply after curbs were eased. This time will be no different.”
Overall fuel demand had tanked 70% and power demand shrunk 15% year-on-year in May last year due to the countrywide lockdown. “The situation was not expected to be similar this time.
Last time it was sudden and everything was shut. This time lockdown in states came sequentially, inter-state movement was on, construction was allowed with conditions and some categories of movement within cities were allowed,” he said.
Still, Jet fuel sales dipped 34% during the month under review from April and more than 70% from May 2019, the sharpest decline in 12 months, as airlines grounded domestic and overseas flights in the absence of passenger traction and restrictions on travellers from India, respectively.
LPG, or common household cooking gas, however, posted a modest growth of 2.5% from April but was down more than 6% from May 2019.

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