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Diesel demand spikes ahead of price hike
NEW DELHI, JUNE 2 (AGENCIES):
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Published on 2 Jun. 2011 10:12 PM IST
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The rate of growth in diesel demand spiked to 14%-15% in May from a mere 1.7% in April as vehicle owners tanked up with the government taking time to revise its price, early sales trend for the month available with state-run oil companies show.
A senior marketing executive of IndianOil Corporation, which controls nearly half of the fuel retail market, said even after petrol price was raised by `5 a litre, demand for the fuel has shown a growth rate of 9%. In April, or before the price revision, demand had grown at 7.4%, stated TOI.
Cumulatively, overall demand for all petroproducts in May stood at 6%, or nearly double the 3.9% seen in April. In 2010-11, overall petroproducts demand grew at 4.2%, whereas petrol registered a growth of 10.8% and diesel 6%. “This paints a stark picture for diesel. It also shows that price increase does not affect demand,” the IndianOil executive said, requesting anonymity.
One dealer in Delhi said even those who normally buy fuel for `500 or `1,000 at a time are tanking up, including diesel vehicle owners.
“Even normally you find long queues at petrol pumps on the eve of price hikes announced by TV channels. This time the period has got longer. Think of transporters and other commercial establishments, in addition to private vehicle owners, who are tanking up and you have a huge inventory building up in private domain. Thruputs of our storage depots have increased and oil companies’ infrastructure is being stretched,” the IOC executive said.

 
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