In a bid to curb bulk diesel purchases at petrol pumps across the country, the government has barred the sale of more than 200 litres of diesel per customer or vehicle per day. The resale of such fuel will also not be permitted.
According to a gazette notification issued by the Ministry of Petroleum and Natural Gas, violations of the order will attract penalties and other legal action under the Essential Commodities Act, 1955, and other applicable laws.
The notification, which is a temporary measure, states that industrial, direct, institutional and commercial consumers are prohibited from procuring fuel from retail outlets and must source their requirements through designated consumer pumps.
The notification further states that Oil Marketing Companies (OMCs) and retail outlet dealers will be responsible for ensuring compliance with the prescribed restrictions and preventing any attempts to circumvent the provisions of the order. State governments and Union Territory administrations have also been directed to take necessary action against malpractices such as black marketing and unauthorized diversion of fuel to safeguard the interests of retail consumers.
These regulations are temporary measures and will initially remain in force for up to 90 days to ensure adequate diesel availability for retail consumers.
The move comes amid a growing trend of industrial, direct, institutional and commercial consumers shifting their diesel procurement from dedicated consumer pumps to retail outlets due to the price differential between bulk and retail diesel. Another reason cited by the government is the sharp decline in high-speed diesel (HSD) sales by private oil marketing companies, which fell by around 58% in May 2026 due to higher prices charged by them.
Data for May 2026, compared with the corresponding period last year, show a significant surge in diesel sales through retail outlets operated by public sector OMCs. As many as 327 districts recorded growth of more than 10%, while 80 districts reported growth exceeding 30%.
According to the government, the measures are aimed at large and bulk consumers who should not be procuring diesel from retail outlets to take undue advantage of price arbitrage. Authorities have also reported blatant instances of large quantities of diesel being purchased in jerry cans and subsequently resold in the market.
The government said the order would enable strict action against buyers, operators, dealers and officials involved in the black marketing and hoarding of diesel.
By preventing the diversion of fuel from retail outlets to bulk consumers, the government expects a larger share of diesel supplies to remain available for ordinary retail customers.
To protect retail consumers during the ongoing disruptions in West Asia, public sector OMCs are currently absorbing losses of around ₹500 crore per day on the sale of petrol, diesel and domestic LPG, the government said.
