Dealer associations in Rajasthan, Madhya Pradesh, Gujarat, Tamil Nadu and Jammu & Kashmir have reported fuel shortages as private pumps have either shut shop or curtailed sales.
Several WhatsApp forwards and social media posts claimed that Gulf countries cut fuel supplies to India in retaliation to former BJP spokesperson Nupur Sharma’s derogatory comments on Prophet Muhammad. That is not the case.
The oil ministry attributed shortages to “temporary logistical issues” at local level, maintaining there is no crisis. It further said petrol and diesel stocks in the country “are more than sufficient”. Oil companies took steps to increase stocks at depots and terminals to tackle the issue as people queue up with empty tanks outside petrol pumps.
So why petrol pumps are running dry?
The Ministry said fuel demand at certain locations in states witnessing shortages has increased by as much as 50% in the first half of June 2022 as compared to last year. A spike in demand has led to shortages in certain states where a bulk of supply is managed by retail outlets belonging to private oil marketing companies which have reduced sales due to rising prices.
It further stated that such massive increase in demand has been witnessed in Rajasthan, Madhya Pradesh and Karnataka.
“In general, the increase in demand has been on account of the seasonal surge in demand due to agricultural activities, bulk buyers having shifted their purchases to retail outlets, and a substantial reduction in the sales by private marketing companies with their substantial volumes having shifted to PSU retail outlets (ROs),” it added.
However, reports claim that government’s directive to state-run oil companies to keep petrol and diesel rates frozen has disrupted deregulated trade, prompting private refiners to divert supplies to more lucrative export markets.
The fuel shortage is artificial one, created by private oil refiners seeking more profit and state run oil companies seeking to cut losses.
This flies in the face of mistruths being propagated on WhatsApp and social media channels claiming that Gulf countries have curtailed supplies to India in the aftermath of BJP spokesperson making incendiary comments against Prophet Muhammad.
Government cracks whip on suppliers
The government on Friday said India relaxed the criteria of permissions for marketing of fuels such as petrol and diesel with an objective to ensure greater participation of private sector in the fuel retail business. Simultaneously, it also ensured setting up retail outlets in remote areas by these entities. The Ministry of Petroleum & Natural Gas in a statement said it wants authorised retailers to provide uninterrupted fuel supply services to the consumers especially in remote areas. The Ministry statement further said retailers must maintain fuel supplies throughout the specified working hours and of specified quality and quantity; make available minimum facilities as specified by the Central Government; maintain minimum inventory levels of fuels as specified by the Central Government from time to time; provide services to any person on demand within a reasonable period of time and on non-discriminatory basis andensuring availability of fuel to the customers at reasonable prices.
“The Government has now expanded as ROs including Remote Area ROs under their ambit. Now the Authorized entities have been obligated to extend the USO to all the retail consumers at all the retail Outlets. This has been done with an objective to ensure higher level of customer services in the market and to ensure that adherence to the USO forms a part of the market discipline,” it further said.