India’s diesel and petrol consumption rose to an all time high record in May 2025 largely aided by robust manufacturing activity, exporters rushing to fulfil orders before close of the US reciprocal tariff deadline as well as some uptick from farm activity due to early monsoon and marriage season.

According to the Petroleum Planning & Analysis Cell (PPAC), India’s diesel consumption rose by 4 per cent M-o-M and almost 2 per cent Y-o-Y to 8.57 million tonnes (mt) last month.

Interestingly during May 2024 (8.41 mt), diesel usage had hit a record aided by the Lok Sabha elections.

Similarly, the consumption of petrol rose by almost 10 per cent M-o-M and 9 per cent Y-o-Y to a record 3.77 mt in May 2025.

The previous high was recorded in March 2025 (3.51 mt).

The consumption of aviation turbine fuel (ATF) rose by more than 1 per cent M-o-M and 4 per cent Y-o-Y at 775,000 tonnes last month.

The HSBC India Manufacturing PMI during May 2025 three-month low amid softer growth of new orders and production.

However, May data indicated another robust improvement in business conditions across India’s manufacturing industry.

Although rates of increase in new orders and output retreated to three-month lows, they remained well above their respective long-run averages.

Analysts said that Indian exporters rushing to meet existing orders and process shipments before the deadline for US tariffs aided diesel usage.

Besides, mining activity continued

According to Shriram’s May 2025 mobility bulletin, a rise in goods movement, coupled with movement of summer fruits contributed to a subtle positive undercurrent in the freight market.

Early monsoons led to some farm activity in southern, western and central India.

Besides, the marriage season also led to stocking for goods thereby boosting freight movement.

Petrol consumption surged to an all time high record last month, which reflects on the growing affluence leading to more personal vehicle purchases, particularly 2-wheelers and four wheelers.

Besides, better highway infrastructure and sustained tourism push also boosted gasoline demand.

Most of the consumption is driven by the personal mobility segment.

Furthermore, the trend of people purchasing more gasoline-driven SUVs is also bolstering demand.

Jet fuel demand continued to hit north, but was below the record 801,000 tonnes (March 2025), 784,000 tonnes (January 2025) and 782,000 tonnes (December 2024). This is due to rising domestic and international air travel supported by rising income levels.

A tad short of the 9 million tonnes (mt) mark, India’s jet fuel consumption scaled multiple peaks during FY25, with airlines guzzling over 800,000 tonnes in the last month of the fiscal year alone—also an all time high.

The commodity grew at a compound annual growth rate (CAGR) of around 1.9 per cent between FY19 to FY25.

Published on June 2, 2025