OPEN APP
Home / News / India /  Petrol, diesel production more than sufficient to deal with demand surge: Govt
Listen to this article

Amid the reports of petrol pumps running dry in states like Madhya Pradesh, Rajasthan and Karnataka, Ministry of Petroleum & Natural Gas on 15 June clarified that production of petrol and diesel in the country is more than sufficient to take care of any demand surge.

"It is a fact that at specific locations in some states, there has been a significant increase in demand for Petrol and Diesel, with an increase being as high as 50% during the first half of June 2022 over corresponding period of last year," it said in an official statement.

The Ministry added that at specific locations in some states like Rajasthan, Madhya Pradesh and Karnataka, there has been a significant increase in demand for petrol and diesel. However, large quantity of supply was being done by retail outlets belonging to private marketing companies to these states, especially 'where the distances from supply locations i.e. terminals and depots are longer', the statement said.

Citing the reason for increase in demand, the ministry said, "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 ROs."

Adding more, the Petroleum Ministry said that as a result of a crackdown by the government on illegal bio-diesel sales, these volumes have also been added to the RO diesel sale.

ALSO READ: Why some petrol pumps in Madhya Pradesh, Rajasthan, Karnataka running dry

"The production of Petrol and Diesel in the country is more than sufficient to take care of any demand surge," the government statement said, adding that the unprecedented growth has created some temporary logistics issues at the local level.

Stating the measures taken, the Ministry said that the oil firms have geared up to tackle these issues by increasing the stocks at the depots and terminals.

Also, to cater to the extra demand, the government assured that extra movement of tank trucks and lorries have been deployed to serve the retail outlets, working hours of depots and terminals have been extended -- including night, and provision of extra quantities of fuels for supply in the affected States have been made.

ALSO READ: Govt asks oil PSUs to come up with monetization plan

Earlier, reports cited a sudden surge in demand at PSU outlets that followed curtailment of operations by private fuel retailers to check the heavy losses they were suffering from trying to compete with heavily under-priced rates of public sector companies. This led to few petrol pumps in states like Madhya Pradesh, Rajasthan and Karnataka run dry.

PSU fuel retailers Indian Oil, HPCL and BPCL haven't raised petrol and diesel prices in tandem with the rise in crude oil (raw material cost). They sell petrol at a loss of 14-18 per litre and diesel at 20-25 - a loss that private retailers Nayara Energy, Jio-bp and Shell aren't able to absorb.

Catch all the Business News, Market News, Breaking News Events and Latest News Updates on Live Mint. Download The Mint News App to get Daily Market Updates.
More Less
Subscribe to Mint Newsletters
* Enter a valid email
* Thank you for subscribing to our newsletter.
Close

Recommended For You

×
Edit Profile
Get alerts on WhatsApp
Set Preferences My ReadsWatchlistFeedbackRedeem a Gift CardLogout