RIL sees diesel sales surging as consumer demand for fuel rises
28 June 2012
Mumbai: On the back of rising petrol rates and increase in demand for fuel from consumers all over the country, Reliance Industries expects demand for diesel to rise as consumers are increasingly opting for the subsidised fuel which costs about 41 per cent lesser than petrol.
According to Petroleum Planning and Analysis Cell (PPAC), oil ministry's data centre, petroleum consumption recorded a monthly growth of merely 0.2 per cent in April 2012 - the lowest in the last one and half years - of which nearly 47 per cent of total consumption was that of diesel.
Aided by the fact that government caps the prices of diesel, which is the most preferred fuel for farmers and heavy vehicle operators, there seems to be a gradually accumulating artificial demand for the subsidised fuel.
Unable to cope up with rising demand, state run oil refiners such as Indian Oil Corp. Ltd and Bharat Petroleum Corp. Ltd., are being hard-pressed to seek help from private oil companies says Reliance.
PSU or state run oil companies have in fact started buying close to 15 million tonnes of diesel per year from private oil companies such as Reliance Industries and Essar to compensate for their deficit. "As this situation continues, we will have to buy more from the private refiners and maybe also increase imports," noted R K Singh, chairman of Bharat Petroleum Corp. Ltd.
This is a bound ro be a boon for private oil companies which have always been pushed to the side of retail fuel market because of cheaper fuel being provided by state-run oil companies.