Petroleum dealers’ appeal for phased reduction in fuel prices  

Consortium of Indian Petroleum Dealers appeals to PM & OMCs to reduce petrol & diesel prices in a phased manner to minimise financial losses.

A body of petroleum dealers has appealed to the Prime Minister and State-owned oil refining and marketing firms they represent to refrain from abrupt reduction in petrol and diesel prices.

Favouring a phased reduction, the Consortium of Indian Petroleum Dealers (CIPD) cited the “substantial financial setback” the trade suffered when fuel prices were slashed in November 2021 and May 2022. “Additionally, our dealer commission has not been revised for several years, further exacerbating our financial challenges,” President Uday Lodh and General Secretary K.Suresh Kumar said.

In its letter to the oil marketing companies, CIPD said “implement significant reductions in a phased manner, such as 50 paise or less per day as this approach will facilitate a smoother transition for dealers, minimising financial losses and aiding in business sustainability. It also wanted the OMCs to bear and reimburse losses incurred due to reductions beyond the net dealer margin.

The dealers body also sought “immediate halt to forceful sales strategies” besides a downward revision in the dead stock level as it imposed substantial financial burden. “The dead stock level of 10% of tank capacity, primarily for protecting OMC devices in underground tanks has imposed a substantial financial burden on dealers. We propose a reconsideration... lower the level to minimum possible.”

The letter addressed to the Prime Minister said “we are not contesting the necessity of reducing fuel prices... humbly request that such reductions be implemented in a phased manner. Abrupt reduction in prices, as experienced in 2021and 2022, had a severe impact on our viability and sustainability.”