Fuel stations across the country could go dry from June 16 with a petroleum dealers’ association threatening to go on strike if their concerns over the proposed roll out of daily price revision are not addressed.
On June 8, state-owned oil companies such as Indian Oil Corporation, Bharat Petroleum Corporation Ltd and Hindustan Petroleum Corporation Ltd, decided on a pan-India implementation of daily price revision of petrol and diesel.
The All India Petroleum Dealers’ Association is demanding an automated system to reflect price changes from the state-run oil marketing companies.
“The decision to implement daily price revision of petrol and diesel was taken unilaterally by state-owned oil companies. We are opposed to that,” Ajay Bansal, president of All India Petroleum Dealers’ Association, said on Saturday.
“At midnight, it takes a few hours to change the rate. During this time we have to keep our pumps closed,” Bansal added.
He said dealers will have to spend “considerable time” every midnight to shift to the new price, waiting for state-run oil companies to convey the new rates that will be fed on the oil dispensing machines and calculators. Then the stock position will have to be measured and meter readings noted. This could lead to long delays at fuel outlets on India’s highways that remain open through the night.
A meeting between the association and the oil firms will be held on June 13 to end the deadlock.
The dynamic pricing is expected to insulate retailers from volatility of global crude prices.
Private retailers such as RIL and Essar are also expected to adopt the new pricing mechanism.
A majority of the nearly 58,000 petrol pumps in India are owned and operated by dealers. And 60-70% of these pumps are on the highways, said the association.
Petrol prices were freed from government control in June 2010 and diesel in October 2014, allowing oil marketing companies to fix retail prices in tune with global crude prices.
State fuel retailers currently revise rates on the 1st and 16th of every month, based on average international crude price in the preceding fortnight and currency exchange rate.