On Tuesday, when Mitesh Jaini's (name changed) fuel retail outlet in Rajkot, Gujarat, went dry on both petrol and diesel, images of year 2008 flashed before him - when Reliance Industries Ltd (RIL) decided to shut down all its fuel retail outlets. For Jaini, another shutdown would be a double whammy post the pandemic.
"My retail outlet has been dry for three days. Dozens of fuel pump owners like me are sending SOS messages to our area managers but there is no communication on what we should do," Jaini told ET, adding that a similar situation in 2008 led him to down shutters.
In 2008, when global oil prices surged to $150 a barrel, it led RIL to close nearly 1,400 pumps as it could not afford to sell fuel at a subsidised rate like its state-run peers who were compensated by way of government subsidies for selling fuel below cost.
"Fuel prices were raised by 0.80 paise a litre over the last two days which is a respite but we have no supplies to sell. My tankers have been waiting to be loaded for the past six days," said another dealer with RIL.
Between November 4 and March 21, crude oil went from $82 per barrel to $111 per barrel.
In an emailed response, Reliance BP Mobility Limited spokesperson said, "RBML (operating under the brand name Jio-bp) operates a pan India network of 1,458 retail outlets. Despite intermittent increases in retail selling price by 80 paise/litre by OMCs, the price difference between retail and industrial price of diesel is ₹24/litre. In spite of the challenges mentioned above, Reliance is fully committed to meet the demand of its retail customers."
The company added that due to heavy diversion of Bulk HSD (Direct Customers) to retail outlets there continues to be a massive surge in demand at fuel stations. "There is also a very heavy lifting of fuel by dealers and both B2B & B2C customers, who have advanced their purchases, to top up their tanks and capacities in anticipation of price increase which is long overdue," RBML said.
Since 2014 retail prices of petrol and diesel in India were linked to global crude prices. However, India's top fuel retailers including-- Indian Oil Corporation, Bharat Petroleum Corporation and Hindustan Petroleum Corporation-- did not increase pump prices since last November till March 21, which has cost them $2.25 billion or 19,000 crore in revenues in March, according to Moody's Investors Service.
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