Oil Marketing Companies saw a modest recovery in September as fuel demand picked up after the monsoon season and authorities tightened control over fuel smuggling. Total sales reached around 1.37 million tons, up 8 percent from last year and 5 percent higher than August.
The increase was mainly driven by motor spirit and high-speed diesel, while furnace oil continued to decline sharply. Petrol sales were up 8 percent year-on-year, while diesel volumes jumped 20 percent year-on-year due to stronger transport and agricultural activity.
Furnace oil, in contrast, fell more than 80 year-on-year, as power generation from FO-based plants remained low.
Petrol has been stable at Rs 264.61 per litre through mid-September, while diesel was raised to Rs 272.77 per litre. From October 1, the government increased petrol by Rs 4.07 to Rs 268.68 per litre and diesel by Rs 4.04 to Rs 276.81 per litre.
During the first quarter of FY26, industry sales totaled roughly 3.9 million tons, an increase of 6 percent from the same period last year.
The growth was mainly supported by a 15 percent jump in diesel sales and a 6 percent rise in petrol. Furnace oil continued its downward trend, falling about 78 percent as power companies relied more on LNG and coal.
Overall, the sales mix improved because non-furnace oil products made up nearly all the industry’s volume growth, which benefits margins for most OMCs.
The improvement shows that the slump seen through FY24 and early FY25 is largely over, although competition remains intense.
The key risks ahead include any relaxation of border enforcement, new price increases that could hurt demand, and potential logistical issues from seasonal floods. However, diesel demand is expected to stay strong in the next quarter due to the upcoming Rabi sowing season.
Comments
Comments are closed for this article.