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Gas demand in India is price sensitive-IV: Dirty fuels gain at the cost of others
Mar 21:
While gas demand slowed down in February, dirty fuel consumption went up
8Petcoke consumption was up 2.2 MMTP in February 2019 as against 1.7 MMT for the same period last month
8Interestingly, naphtha consumption was down as well on higher pries at 1 MMT in February 2018 in relation to 1.1 MMT for the same month last year
8FO/LSHS consumption stayed at the same level at 0.5 MMTP for the month
8For the 11-month period, ending February 2018, petcoke consumption went up to 24.1 MMT in relation to 21.8 MMT for the same period last year
8Cumulative naphtha consumption for the period was however down 11.3 MMT this year as against 12.1 MMT last year
8FO/LSHS consumption too declined 6.20 MMT as against 6.6 MMT in April-February, 2016-17
8The point to note is that gas consumption for February was down to 4.5 BCM as against 4.6 BCM. For April-February 2017-18, it was 52.9 BCM in relation to 50.7 BCM for the same period last year.
8So what does the data show? That the rise in gas consumption is very slow indeed. The fact that high prices are stymieing demand is clearly evident in the February consumption figures.
8Even though consumption is up in April-February 2017-18, it is not going up fast enough.
8On the other hand, what is seen in liquid fuels is that higher prices of FO/LSHS and naphtha are causing their consumption to be replaced by relatively cheaper petcoke which is produced in abundance by Indian refineries.
8Unless strict action is taken to ban petcoke, its consumption will rise at the expense of other competing fuels.
8At the end of the day, increase in gas consumption may not take place even after such as ban as gas will will then have to reckon with FO and naphtha demand.
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8Petcoke consumption was up 2.2 MMTP in February 2019 as against 1.7 MMT for the same period last month
8Interestingly, naphtha consumption was down as well on higher pries at 1 MMT in February 2018 in relation to 1.1 MMT for the same month last year
8FO/LSHS consumption stayed at the same level at 0.5 MMTP for the month
8For the 11-month period, ending February 2018, petcoke consumption went up to 24.1 MMT in relation to 21.8 MMT for the same period last year
8Cumulative naphtha consumption for the period was however down 11.3 MMT this year as against 12.1 MMT last year
8FO/LSHS consumption too declined 6.20 MMT as against 6.6 MMT in April-February, 2016-17
8The point to note is that gas consumption for February was down to 4.5 BCM as against 4.6 BCM. For April-February 2017-18, it was 52.9 BCM in relation to 50.7 BCM for the same period last year.
8So what does the data show? That the rise in gas consumption is very slow indeed. The fact that high prices are stymieing demand is clearly evident in the February consumption figures.
8Even though consumption is up in April-February 2017-18, it is not going up fast enough.
8On the other hand, what is seen in liquid fuels is that higher prices of FO/LSHS and naphtha are causing their consumption to be replaced by relatively cheaper petcoke which is produced in abundance by Indian refineries.
8Unless strict action is taken to ban petcoke, its consumption will rise at the expense of other competing fuels.
8At the end of the day, increase in gas consumption may not take place even after such as ban as gas will will then have to reckon with FO and naphtha demand.
Click on Reports for more
