India's August Fuel Demand Falls 2.8% Despite Strong Diesel, Gasoline Sales

India's total fuel consumption, a key proxy for oil demand, fell by 2.8% in August 2026 compared to the same month a year prior, despite strong growth in key transportation fuels. Total consumption for the month stood at 18.61 million metric tons, according to data released by the Petroleum Planning and Analysis Cell (PPAC) of the oil ministry.

Mixed Performance Across Fuel Types

The headline decline masks a divergent trend among different fuel categories. While fuels associated with transport and construction saw healthy increases, consumption of cooking gas and industrial inputs fell sharply.

Key figures from the August report include:

• Gasoline: Sales rose 8.2% year-over-year to 3.84 million metric tons.
• Diesel: Consumption, a bellwether for industrial activity, increased 6.8% to 7.02 million metric tons.
• Liquefied Petroleum Gas (LPG): Sales of cooking gas dropped significantly by 17.2% to 2.35 million metric tons.
• Naphtha: Industrial demand for naphtha plunged 22.3% to 0.83 million metric tons.

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Economic Indicators

The data presents a mixed picture of India's economic activity. The strong performance of diesel and gasoline sales suggests that personal mobility and commercial transport sectors remain robust.

Furthermore, bitumen sales, used for road construction, climbed 19.8%, indicating continued momentum in infrastructure projects. Conversely, the steep declines in LPG and naphtha were the primary drivers of the overall decrease, pointing to potential shifts or weakness in household consumption and the petrochemical industry.