The Hindu Business Line : Petro products sales rise 6.2 pc in July

CONSUMERS stocked up on petrol and diesel in July, just before oil companies announced a hike in prices on the last day of the month. Public sector oil companies sold 13 per cent more diesel and 5 per cent more petrol through their retail outlets last month.Overall sales of petroleum products went up 6.2 per cent, in spite of the price rise.

"Historically, sales of transport fuels go up just before an anticipated increase in prices. July could not have been an exception," said a senior analyst.

Overall diesel sales, considered an indicator of economic growth, grew 10.8 per cent in July 2004, according to figures compiled by public sector oil companies, which own more than 90 per cent share of the country's fuel market.

Petrol sales were up 4.9 per cent with a 5.1 per cent increase in retail sales; bulk sales, however, suffered a negative growth of 9.4 per cent in July.

Sale of compressed natural gas, available only in the metros, continued climbing with a 40.7 per cent growth. Aviation turbine fuel sales increased 7.1 per cent in July.

Among other fuels, LPG sales continued to grow. Sales during the month were up 7.3 per cent.

Kerosene sales recorded a negative 2.6 per cent growth. Sales have been falling since November last year when the Union Government barred private companies from importing kerosene as a measure to curb adulteration of transport fuels and announced Indian Oil Corporation as the nodal agency for kerosene sold outside the public distribution system.

Senior officials of oil companies believe sales of transport fuels have been inversely proportional to kerosene sales, ever since the Government adopted this measure.

"We do not think it is merely customers buying more products in anticipation of a price hike, that led to higher sales. Diesel sales have improved substantially ever since the ban was put in place. And have remained high since last November except for a couple of months," said a senior BPCL official.

Among the feedstock products, naphtha sales recorded a negative growth of 8 per cent in July while furnace oil and low sulphur heavy stock sales grew by 3 per cent compared with last July.

Bitumen, used mostly in road construction, recorded a 29.9 per cent jump in sales volumes in July.

Industrial and automotive lubes and greases, however, saw volumes fall to report negative growth of 12.2 per cent.