India’s consumption of diesel, petrol, and jet fuel has surged to near-record levels since March 2025, with May 2025 marking an all-time high. The demand for these fuels has been notably bolstered by the festival season, along with recent reductions in Goods and Services Tax (GST) rates, which resulted in a 12% month-on-month increase in diesel consumption to 7.6 million tonnes in October 2025, according to the Petroleum Planning and Analysis Cell (PPAC). Despite the month-on-month rise, the annual diesel consumption remains slightly lower.
Petrol usage also observed a significant increase, rising more than 7% month-on-month and year-on-year, reaching 3.45 million tonnes in October 2025. Additionally, aviation turbine fuel (ATF) consumption hit its highest level in five months, climbing 7% from the previous month to 769,000 tonnes, reflecting the increasing demand for air travel.
Notably, the rise in fuel consumption is attributed largely to the easing of GST rates aimed at stimulating spending during the festive and wedding season in the October-December period. Industry sources indicate that the agricultural sector is also driving demand in anticipation of the Rabi season, while resumption of mining activities further contributes to increased fuel sales.
The expansion of personal vehicle ownership among the middle class supports rising petrol consumption, which is further amplified by the recent GST rationalization efforts. The International Energy Agency (IEA) projected in a June 2025 report that India is expected to contribute the largest single-country increase in oil demand growth—from 1 million barrels per day—primarily driven by petrol and jet fuel consumption.
Factors such as an expanding middle class and rising affluence are contributing to a sustained increase in demand for petrol and jet fuel, pointing to shifting dynamics in personal mobility and aviation markets. The IEA expects jet kerosene demand to grow at a rate of nearly 6% annually, boosted by a population growth of 5% projected between 2025 and 2030—a time when India’s affluent demographic is increasingly spending on luxury and international travel. Similarly, gasoline demand is projected to increase by 4%, benefiting from the country’s relatively low vehicle ownership levels.
Published on November 2, 2025.
