Petrol and diesel consumption in Telangana is on revival course, presumably faster than anticipated, as COVID-19-triggered-lockdown and restrictions that severely impacted the offtake are being relaxed.

‘It is pretty good now’ is how R. Sravan S. Rao, executive director and State head of the Indian Oil Corporation (IOC) for Telangana and Andhra Pradesh, sought to sum up the pick-up in demand.

As Telangana, like the rest of the country, braced up for the fight against the pandemic with the lockdown in the second half of March, roads became deserted as most of the vehicles stayed away and people remained indoors with police cracking down on those violating the guidelines.

Indeed, the number of vehicles coming to petrol pumps turned into a trickle. Many petrol bunks also functioned only for a few hours in a day. According to officials, the fuel offtake in March was just one-fourth of that registered in March 2019.

In April it improved, but still was a shade less than 50% of the consumption in the corresponding period the previous year. Things started looking up in May as the curbs were relaxed. The petrol offtake in the current month is around 75% compared to the same period last year, while in the case of diesel it is around 80%.

A key driver of revival in diesel consumption was farm activity, specifically harvesting. Helping matters was also the Centre’s emphasis on facilitating road movement of cargo, particularly its insistence that inter-State movement of essential goods not be impeded. Petrol offtake could be linked to reopening of some commercial establishments, private offices allowed to function with limited staff and many people venturing out of their houses.

But for the heatwave-like conditions, the demand could have been slightly higher, Mr. Rao said, adding it, however, would be some months before return of normalcy in fuel offtake.

Echoing similar sentiments on the long road ahead, a senior official of the Hindustan Petroleum Corporation (HPCL) said fuel intensive operations such as mining were yet to resume, many industrial units were operating with limited staff and only up to the permitted level of their capacity, while IT industry, where transportation of employees is a norm, continued with a work-from-home policy.

Concurring with the officials on the time to normalcy, Telangana Petroleum Dealers’ Association president M. Amarender Reddy said the actual sales or fuel dispensed through nozzles would be relatively less as companies tended to push products to the dealers.

For the trade, the lockdown translated into lower sales, even as operational costs remained the same and there was delay in receipt of payments from bulk users such as bus and truck operators who were supplied on credit.

National oil marketing companies IOC, HPCL and Bharat Petroleum Corporation dominate the automobile fuel market in Telangana and Andhra Pradesh, accounting between them for around 95% of the 7.466 million tonne (MT) sales in 2019-20, while the rest is with private players. In Telangana, petrol sale last fiscal was 1.28 MT as against 1.19 MT in 2018-19, while diesel consumption saw a fall at 3.621 MT (3.85 MT).

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