Method for controlling output torque (Teng) of a propulsion unit in a vehicle powertrain including driven wheels drivingly connected to the propulsion unit via a mechanical transmission with a drive shaft, wherein the method including the steps of registering driver torque demand (Td) for vehicle propulsion, registering propulsion unit rotational speed (ωe), and controlling the output torque (Teng) of the propulsion unit to asymptotically follow the driver torque demand (Td) using a closed-loop linear-quadratic regulator (LQR) based controller (9) having the driver torque demand (Td) and the propulsion unit rotational speed (ωe) as input data, in order to minimize driveline oscillations.