LPG Sales Drop 24% In May As Petrol And Diesel Demand Continues To Rise

State-run oil marketing companies reported a sharp decline in LPG sales in May, while petrol, diesel and aviation fuel consumption registered healthy growth, indicating changing fuel consumption patterns across the country.

India witnessed a significant divergence in fuel demand trends during May, with liquefied petroleum gas (LPG) sales declining sharply even as petrol and diesel consumption continued to grow.

Data released by state-run oil marketing companies showed that LPG sales fell 24 per cent year-on-year in May, marking a much steeper decline than the drop recorded in April. The decline comes after LPG consumption had already fallen by nearly 16 per cent in April, suggesting continued weakness in the domestic cooking gas segment.

In contrast, transportation fuels recorded steady growth. Petrol sales increased by 4.8 per cent, while diesel sales rose by 6.4 per cent compared to the same period last year. Aviation turbine fuel (ATF) consumption also registered growth, reflecting increased air travel activity.

The three major state-owned oil marketing companies account for nearly 90 per cent of the country’s petrol, diesel and aviation fuel market and dominate the domestic LPG segment. Industry-wide figures, including sales data from private fuel retailers, are expected to provide a broader picture of overall fuel demand trends.

One of the most notable trends in May was the strong growth in diesel consumption. Diesel sales expanded faster than petrol sales despite diesel having a significantly larger consumption base. India consumes nearly two-and-a-half times more diesel than petrol, making such growth particularly noteworthy.

Industry observers believe the trend may reflect a shift in purchasing patterns among bulk diesel consumers. Many large users reportedly moved towards retail fuel outlets to benefit from comparatively lower prices available at state-run pumps.

This change appears to have helped state-owned retailers capture a larger share of diesel sales, contributing to the stronger-than-usual growth recorded during the month.

The contrasting movement between LPG and transportation fuels highlights changing consumption trends in the energy sector.

While mobility-related fuel demand remains strong, LPG consumption has shown continued weakness for two consecutive months. Analysts suggest factors such as changes in refill patterns, pricing sensitivity and consumption behaviour could be influencing demand in the cooking gas segment.

At the same time, continued growth in petrol, diesel and aviation fuel consumption points to sustained economic activity, transportation demand and travel across the country.

A more complete assessment of fuel demand is expected once industry-wide sales figures are released. These numbers will include data from private fuel retailers and provide a clearer understanding of whether the trends observed among state-run companies reflect broader market conditions.

For now, the latest figures indicate a notable shift in India’s fuel consumption landscape, with transportation fuels maintaining momentum while LPG demand experiences a significant slowdown.

Disclaimer: Fuel demand trends are based on provisional sales data and may change when industry-wide figures are released. Market conditions and consumption patterns can vary over time.