The country’s fuel demand, hit by a deadly second wave of coronavirus, would recover to pre-pandemic levels by the end of this year, oil minister Dharmendra Pradhan said on Tuesday.
Local fuel consumption- a proxy for oil demand – in May slumped to its lowest since last August as lockdowns and restriction in several states stalled mobility and muted economic activity.
Indian fuel demand showed signs of resurgence this month due to the lifting of lockdowns by states and a gradual pick-up in economic momentum, Pradhan said at an energy summit organised by BNEF.
India, the world’s third-biggest oil importer and consumer, imports over 80 per cent of its oil needs. Asia’s third-largest economy has been hit hard by a spike in global oil prices, with its tax-heavy retail prices of petrol and diesel touching record highs.
“Inflation is a challenge to the globe today …so we are also facing this challenge in our economy. But with all these challenges we are confident by the end of this calendar year we will be in a position to restore our original consumption behaviour,” Pradhan said.
The minister has repeatedly asked the Organisation of Petroleum Exporting Countries and its allies to ease supply curbs for a demand-led recovery.
Ahead of the meeting of OPEC and its allies on July 1, Pradhan said he expect oil prices to ease.