Reports indicate that the Federation of All India Petrol Traders, which accounts for 42,000 of India’s 45,000 pumps, seek permission to retail the fuel products of private oil marketing companies like Essar Oil, Reliance Industries (RIL).
Right now, according to an agreement with state-run OMCs, these traders can market the fuel of only the three public sector OMCs.
However, with the partial de-control of diesel pricing, the federation feels that private firms may set up fuel pumps of their own and compete with the existing ones.
In order to prevent such competition, the federation wants to be allowed to market the fuel products of private firms as well.
Before the decontrol of fuel prices is implemented, the federation plans to approach the government to protect its business, which it fears the private players might wash out.
When diesel was selling at market rates, Reliance and Essar Oil had swiftly snatched 15 percent of the diesel market by setting up sprawling pumps along highways.
Dealer-owned-dealer-operated outlets will be hugely hit if private players come in. Unlike national OMC dealers, there are no stringent regulations governing the private players related to fuel quality, dealership network or sale. This creates a huge gap in the margins of a private pump and an individual one, industry sources informed.
Leave a Reply
You must be logged in to post a comment.