Daily fuel price revision: Petrol pump owners to meet oil firms tomorrow to avert strike
Fuel dealers on Sunday said they will stop purchasing fuel from 16 June, when a plan to revise fuel prices daily in sync with international crude prices is set to take effect.
The dealers said retail outlets need to be automated first before such a change can be made.
After a five-city pilot project, three state-run oil marketing companies (OMCs) — Indian Oil Corp (IOC) Ltd, Bharat Petroleum Corp Ltd (BPCL) and Hindustan Petroleum Corp Ltd (HPCL) — on June 8 decided to implement the change nationwide starting June 16.
“This is not a strike. We are just terming it no-purchase till our concerns are addressed. We do not think we are ready to roll out daily fuel pricing across till all the retail outlets are automated. This could lead to transparency issues,” said Ajay Bansal, president of All India Petroleum Dealers’ Association.
Bansal’s association represents dealers who sell 86% of auto fuel sold in India; private companies such as Reliance Industries Ltd and Essar Oil Ltd sell the rest.
Oil companies have called upon dealers for a meeting on Tuesday to discuss their concerns, Bansal said.
The association will seek to postpone the plan’s implementation. Meanwhile, dealers are keeping open the option of protesting, including by not purchasing fuel, if the meeting does not address their concerns.
According to Bansal, OMCs decided to implement the daily price change all of a sudden. “It has to be implemented by dealers and it requires automation in price administration. It can-
WHENEVER THERE IS A RISE IN GLOBAL PRICES DUE TO GEOPOLITICAL ISSUES, IT WILL GET REFLECTED IN LOCAL PRICES IF FUEL PRICES ARE REVISED DAILY
not be done manually,” he said.
He said dealers will decide their next step depending on the outcome of the meeting.
Meanwhile, the OMCs took out advertisements in Sunday’s newspapers announcing the shift to daily prices and how customers can check the latest prices.
The decision to move from fortnightly revision to daily revision follows the successful implementation of pilot projects in Udaipur, Jamshedpur, Puducherry, Chandigarh and Vishakhapatnam from May 1, a statement from oil companies said on 8 June.
Daily price revision is an international practice. Oil com- panies said it will make retail prices more reflective of the current market conditions and will increase transparency in the system. However, whenever there is a sudden spike in global prices on account of geopolitical reasons, it will instantly get reflected in local prices too. In fortnightly prices, short-lived sentiment-driven price spikes get ironed out.
A senior official from an oil marketing company, on condition of anonymity said: “The fears of petroleum dealers are unfounded. When we implemented the daily pricing in five cities on a pilot basis, not all retail outlets were automated. But we still ran smooth operations. So now, when daily fuel pricing is extended across the country, we do not anticipate any issues. We will explain it to the dealers in our meeting on Tuesday.”
There are 56,000 retail outlets of which only around 20,000 are automated so far. The ministry has asked the OMCs to automate all outlets by March.