Festive demand drives India's diesel sales in October, data shows

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The Economic Times daily newspaper is available online now. Read Today's Paper Festive demand drives India's diesel sales in October, data showsBy ReutersLast Updated: Oct 16, 2026, 03:31:00 PM ISTSynopsis

Indian diesel consumption has risen significantly, driven by increased demand from the agriculture and transportation sectors. State-run fuel retailers continue to maintain fuel prices below market rates, which attracts consumers. In contrast, private retailers have increased their prices and are exporting fuels. The ongoing festival season has led to heightened purchases by wholesalers to build inventory. Diesel is also being used to generate electricity due to rising power demand.

Indian diesel consumption is rising, driven by increased truck movement during the festival season and the nation's efforts to shield motorists from higher global prices, according to industry sources and preliminary sales data.

Global diesel prices have surged to record highs in many markets due to disrupted supply as the prolonged Iran war and the Russia-Ukraine conflict pose inflation and cost-of-living threats to governments and consumers.

Sales of diesel by state-run fuel retailers in the first half of October rose to 3.65 million metric tons (around 27 million barrels), up about 26.4% from the same period in September and 25.4% from a year earlier, data shows.

Also read: Ethanol supplies top 987 crore litres by September, grain feedstocks lead: AIDA

"Diesel consumption is rising due to demand from the agriculture sector, and transportation has picked up due to festival season demand," said SP Singh, a senior fellow at the Indian Foundation of Transport Research and Training.

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Farmers in India use diesel-fuelled gensets for irrigation.

"Wholesalers have boosted purchases, leading to higher trucking, to build inventory and meet consumer demand during the festival season till at least Diwali in November," said Singh.

He said truck sales rose sharply to 44,323 units in September 2026, up 33.57% from August.

Also read: Record oil tanker rates put pressure on Asian refiners, IEA says

Fuel sales at below-market rates

State-run Indian Oil Corp, Bharat Petroleum and Hindustan Petroleum mostly meet local demand and sell fuel at below market rates to retail consumers.

The three companies have not revised pump prices since May and are currently taking a hit of around 20 rupees ($0.21) on retail sale of a litre of diesel, said Prashant Vasisht, senior vice president at rating agency ICRA Ltd.

In contrast, private retailers Nayara Energy and Reliance Industries have raised prices and are exporting fuels to profit from higher global margins.

Diesel is also consumed for generating electricity to meet rising power demand, Vasisht said, adding customers who were buying from private companies are now shifting to state retailers' outlets.

A liter of gasoline and gasoil sold at private retailers' fuel stations is costlier by 3 rupees and 5 rupees, respectively, compared with the prices of state fuel retailers.

State retailers' gasoline sales rose to 1.55 million tons during October 1-15, a growth of 0.9% from the same period last month, the data showed.

($1 = 94.9700 Indian rupees)
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Read More News onIndia diesel salesfestive season demanddiesel consumption increaseglobal diesel pricestransportation sector growthagriculture diesel consumptionpump prices Indiadiesel and gasoline price comparisonfuel demand during Diwali

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Read More News onIndia diesel salesfestive season demanddiesel consumption increaseglobal diesel pricestransportation sector growthagriculture diesel consumptionpump prices Indiadiesel and gasoline price comparisonfuel demand during Diwali

(Catch all the Business News, Breaking News and Latest News Updates on The Economic Times.)

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