Key Takeaways
- Diesel consumption in India rose by 26.4% in the first half of October.
- Increased truck movement and higher demand from the agriculture sector contributed to the rise.
- State-run fuel retailers sold 3.65 million metric tons of diesel, up from 27 million barrels in September.
Indian diesel consumption has seen a significant increase, driven by heightened truck activity during the festive season and efforts to mitigate the impact of global price hikes, according to industry sources and sales data.
Preliminary sales data from the first half of October reveal that diesel consumption reached 3.65 million metric tons, marking a 26.4% increase from September and a 25.4% rise from the same period last year.
SP Singh, a senior fellow at the Indian Foundation of Transport Research and Training, attributed the rise to demand from the agriculture sector, where diesel-fuelled generators are used for irrigation, and the transportation sector, which has seen a boost due to the festival season.
Wholesalers have increased their purchases to build inventory and meet consumer demand during the festival season, leading to a sharp rise in truck sales to 44,323 units in September 2026, up 33.57% from August.
State-run fuel retailers, including Indian Oil Corp, Bharat Petroleum, and Hindustan Petroleum, continue to sell fuel at below-market rates to retail consumers, taking a financial hit of around 20 rupees per litre of diesel.
In contrast, private retailers such as Nayara Energy and Reliance Industries have raised their prices and are exporting fuels to capitalize on higher global margins, making their products more expensive than those from state retailers.
Diesel is also consumed for generating electricity to meet rising power demand, according to Prashant Vasisht, senior vice president at rating agency ICRA Ltd.
State retailers’ gasoline sales also saw a slight increase, rising to 1.55 million tons during October 1-15, a 0.9% growth from the same period last month.
