CHENNAI: Retail outlets of oil marketing companies (OMCs) such as Hindustan Petroleum and Bharat Petroleum in many parts of the city have gone dry and this has hit consumers hard.
When The New Indian Express spoke to dealers, they said bulk customers filling up fuel at retail outlets (instead of directly from OMCs) and OMCs demanding advance payment from dealers have led to the shortage.
Meanwhile, Petroleum Ministry officials assured that there is enough fuel stock and consumers need not worry.
Bulk consumers began filling up at fuel stations after OMCs hiked the price of petrol and diesel for bulk buyers by Rs 27 and Rs 38 a litre respectively. This has driven up volumes in retail outlets and similarly, impacted direct sales of OMCs.
Also, many dealers are facing financial hardship as OMCs have started demanding advance payments from petroleum dealers for supply of fuel, which dealers are unable to pay as they provide fuel to many of their consumers on credit.
Regular consumers have five-day credit, week-end credit, monthly credit and even year-end credit arrangements. This enhances business and is common practice, says Tamil Nadu Petroleum Dealers Association president KP Murali.
"Now, the dues have ballooned up to lakhs of rupees and with oil majors demanding advance payment to replenish fuel, dealers are unable to make the payment. Some such fuel outlets have gone dry due to this," he said.
When queried on bulk consumers shifting to retail outlets, Murali said retailers can't say no to a consumer. "If someone asks for fuel, we can't deny them," he stated.
A Bharat Petroleum (BP) official admitted there has been an issue with payments by dealers. "We have been asking the dealers to pay in advance. They are facing difficulty as they have been providing the petrol to consumers on credit," he said.
However, the official said bulk consumers buying from retail outlets is not a feasible arrangement. "Their consumption is huge. It won't be feasible for retail outlets to sell to industry or bulk consumers," he added.
However, dealers also complained of supply shortage. Ganesh (name changed), who runs fuel stations near Pallavaram, told The New Indian Express that his pumps went dry on Wednesday.
"OMCs now want me to pay them in advance. I had paid nearly Rs 1.35 crore for the three outlets and only today we got replenished. But the stocks won’t last till Friday. We may go dry again by Friday afternoon," he said.
Senthil Kumar, who runs an HP outlet near Gummidipoondi, said: "Despite making advance payment, fuel was denied for the past three days. I lost Rs 1.5 lakh in the three days."
Similarly, R Ravi, an HP station owner in Periyakulam, said that on Tuesday and Wednesday, many stations in the area only received around 50 per cent of the required supply. "But officials assured there won’t be an issue in the future," he said.
A fuel outlet staff in Coimbatore added, "In many outlets in the city, there is no normal petrol supply. But branded high-performance fuels like Speed and Extreme are available."
Another issue facing OMCs is logistics. Petroleum companies, reeling under losses due to international fuel price hike, have cut overtime for employees and fuel supply has been restricted to day time as a result. This too has hit fuel availability at retail outlets.
Also, many oil companies are allegedly splitting the load to cover as many outlets as possible with limited manpower. Previously, a retail outlet got 20,000 litres of petrol from a single tanker. Now, it has been split among four outlets, rued a dealer in Chennai.
KS Kaliyaperumal, former president of the Truck Owners Association in Coimbatore which runs several fuel outlets across the district, echoed the view. "Supply of petrol and diesel has been reduced for the last two months. The situation has worsened over the past few days. Outlets that got 20,000 litres of petrol per day are getting 4,000 litres. If the government does not intervene and find a solution, the situation may worsen," he said, adding that companies refuse to give a proper reason.
Murali added that a forum of petroleum dealers, including those from other States, have submitted a memorandum to the Secretary of Petroleum and Natural Gas, who assured there is adequate stock of fuel. "The issue is likely to be resolved in a couple of days," he said.
(Inputs from Madurai and Coimbatore)