The country’s fuel demand posted its first year-on-year increase since February as a spurt in diesel demand ahead of the festival season pushed consumption to pre Covid-19 levels.

Total demand for petroleum products rose 2.5 per cent in October to reach 17.77 million tonnes compared with 17.34 million tonnes a year back, according to provisional data published by the oil ministry’s Petroleum Planning and Analysis Cell.

The fuel demand, however, defied the belief of a struggling economy and widespread job losses. Relaxations in the country’s lockdown measures along with the current festival season have helped revive fuel demand.

The spurt in demand comes at a time the country is likely to have fallen into an economic recession for the first time in its history after GDP shrank by an estimated 8.6 per cent during July-September, the RBI said.

Industry officials said Indian Oil Corp has been operating at 100 per cent capacity since early November as fuel demand has recovered. IOC has been gradually raising crude runs at its plants, which plunged to about 39 per cent at the beginning of April when a nationwide coronavirus lockdown hit fuel demand.

Diesel demand soared 7.4 per cent year-on-year to 6.5 million tonnes. Fuel demand had snipped 49 per cent in April after the nationwide lockdown.