New Delhi [India]: India’s fuel consumption witnessed a notable decline in February 2025, driven by an increasing shift towards electric vehicles (EVs) and compressed natural gas (CNG), as per a report by SBI Securities.
Key Findings from the Report
🔹 Petrol Consumption at a 12-Month Low
- February 2025: 3.1 million metric tonnes (MMT) – lowest in 12 months.
- Month-on-Month (MoM) drop: 5.4% decline from January 2025.
- Year-on-Year (YoY) growth: 3.5% higher than February 2024.
- Highest petrol consumption in FY 2024-25: 3.4 MMT in May 2024.
🔹 Diesel Demand Continues to Decline
- February 2025: 7.3 MMT – 5.1% lower MoM and 1.2% lower YoY.
- Lowest diesel consumption since September 2024, when it dropped to 6.3 MMT.
- Primary reason: Shift to EVs and CNG, especially in the light commercial vehicle segment.
🔹 Aviation Turbine Fuel (ATF) Consumption Drops
- ATF demand saw a six-month decline, reaching 7.3 MMT in February 2025.
Drivers Behind the Decline in Fuel Consumption
✅ Rise of Alternative Fuels: Increasing adoption of EVs and CNG vehicles across segments.
✅ Government Policies: Incentives for EV adoption, expansion of CNG infrastructure, and rising fuel prices encouraging sustainable alternatives.
✅ Changing Energy Landscape: India is gradually transitioning away from fossil fuels, affecting both private and commercial vehicle sectors.
Implications of the Decline
📉 Revenue Impact: Lower fuel tax collections could affect government earnings.
🏭 Oil Sector Adaptation: Companies will need to pivot towards alternative energy solutions.
🌱 Sustainability Goals: Aligns with India’s clean energy transition and carbon reduction targets.
With EV and CNG adoption increasing, traditional fuel demand is expected to remain under pressure. The long-term impact on government policies, fuel pricing, and oil companies will be closely monitored.