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Tamil Nadu petrol and diesel consumption stagnates despite 7% GSDP growth

In Tamil Nadu, petrol and diesel consumption has leveled off, even as GSDP growth rate has averaged 7% annually over the last ten years. A White Paper cautions that ongoing shifts to Compressed Natural Gas and electric vehicles could lead to a further drop in fuel consumption revenue.

BRIC Team
BRIC Team
Jun 17, 2026 · 1 min read · 2 views
Tamil Nadu petrol and diesel consumption stagnates despite 7% GSDP growth

Key Takeaways

  • •Diesel consumption in Tamil Nadu plummeted from 750 crore litres in 2016-17 to just 564 crore litres in 2020-21 due to the pandemic.
  • •Petrol usage in Tamil Nadu is projected to rise to 532 crore litres by 2025-26, marking a CAGR of approximately 6%.
  • •The state's Gross State Domestic Product (GSDP) has averaged around 7% growth annually over the past decade despite stagnant fuel consumption.
  • •The White Paper attributes fuel consumption stagnation to enhancements in fuel efficiency and the rise of electric vehicles.
  • •The ongoing shift to alternative energy sources is expected to further decline fuel consumption revenue in Tamil Nadu.

Petrol and diesel consumption in Tamil Nadu has plateaued by 2026. Sharp contrast to state's GSDP growth,which averaged 7% annually over last decade .

Diesel use nosedived during COVID-19, dropping from 750 crore litres in 2016-17 to 564 crore litres by 2020-21. It's bounced back to 770 crore litres in 2025-26,but report indicates growth still flat . Petrol consumption,however,has steadily risen, climbing from 312 crore litres in 2016-17 to 532 crore litres by 2025-26 — CAGR of about 6%.

The White Paper points to several factors for stagnation. Better fuel efficiency,more CNG and electric vehicles,and shifting freight patterns play big roles. With alternative energy on rise,revenue from fuel consumption likely to keep sliding…

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