Petrol pump dealers demand margin hike; to not buy fuel on Tues in 22 states

The Petrol Pump Dealers Association will on Tuesday resort to ‘no purchase of petrol and diesel’ in protest against no increase in their commission by the oil marketing companies. The protest though is unlikely to disrupt supplies as fuel bunks have enough stocks to last couple of days. The Association said its members in 22 states will join the protest.

It demanded increase in dealers’ commission immediately.

‘Commission not revised since 2017’

“Though there was an agreement between oil companies and dealer associations that the dealer margins will be revised every six months, it has not been revised since 2017. The prices of fuel have almost doubled since 2017, hence the working capital in business has doubled leading to additional loans and bank interests thereupon,” the association said in a statement.

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“Evaporation losses have increased proportionately. Also, the overhead expenses, like bank charges, electricity bills, salaries, etc., have increased manifold during the last five years. Our constant demand to revise dealer commission has been overlooked by the OMCs (Oil Marketing Companies). By doing so, OMCs are making their own network financially unviable,” the statement said.

Sudden excise duty cuts lead to loss

Dealer associations welcomed the relief given to citizens of the country by the central government in reducing prices of petrol and diesel through excise duty cut.

“However, these sudden cuts have led to huge financial loss to the dealers. The central government in the past six months has announced two major cuts in excise duty (on November 4, 2021, and May 21, 2022), and the entire burden of Rs 13 per litre on petrol and Rs 16 per litre on diesel was passed on to the petrol pump dealers causing huge irrecoverable losses,” it said.

The 22 states where the dealers will be on protest are Tamil Nadu, Karnataka, Kerala, Telangana, Andhra Pradesh, Delhi, Punjab, Haryana, Rajasthan, Gujarat, Maharashtra, Himachal Pradesh, Bihar, Assam, Meghalaya, Arunachal Pradesh, Mizoram, Nagaland, Manipur, Tripura, Sikkim and North Bengal.

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