New Delhi: Reliance Industries Ltd has reopened 900 petrol pumps, which were shut down when state firms were selling heavily subsidized fuel, the head of the firm’s refinery business, P. Raghavendran, said.
Cautious step: A file photo of a closed RIL petrol pump in Rajasthan. The reopening of RIL’s fuel pumps has been done mostly in western and southern India, says the head of the firm’s refinery business. Harikrishna Katragadda / Mint
“Mostly these are in western and southern India. Wherever we can operate at PSU (public sector unit) prices, we are operating,” he told reporters on Tuesday.
In March last year, a Reliance official said the company was shutting down 900 company-owned pumps as subsidized sale by state firms made private sales unviable.
Reliance Industries, India’s biggest conglomerate, also sold fuel through 500 dealer-operated pumps.
Essar Oil Ltd, the only other private refiner in India, and Reliance had together captured about 17% of domestic retail market for diesel and accounted for 10% of petrol sales by 2005 before heavily subsidized sales by state-run firms knocked them out of the arena.
When crude oil prices more than halved in three months from their $147 (around Rs6,850 today) a barrel peak scaled in July 2008, retail sales by private firms became viable again, prompting Essar to say it would reopen most of its 1,250 fuel stations.
But Reliance Industries adopted a more cautious approach and a company official said on October 2008 that the firm would reopen its pumps only if the government changes its policy of subsidizing only the fuel sold by state-run retailers.
The Union government subsidises fuel sales to control inflation.