CHENNAI: With oil marketing companies (OMCs) in Tamil Nadu instructing dealers to restrict diesel sales to commercial buyers in view of the Gulf conflict, the bulk consumers are forced to forego discounts and shell out market-linked rates, which currently stands at Rs 141 per litre, the Tamil Nadu Petroleum Dealers Association stated.
According to industry sources, bulk consumers like industries, transport operators and commercial establishments were buying high-speed diesel (HSD) at Rs 82/litre just before the start of the West Asia conflict.
Once the war started, the market-linked rate of the fuel rose to Rs 113 before increasing sharply to Rs 141 per litre.
K Murali, president of the Tamil Nadu Petroleum Dealers Association, said bulk consumers were offered diesel at discounted rates before the outbreak of the Gulf conflict. “Post-war, bulk buyers are being charged market-linked prices, which have risen sharply, while ensuring retail consumption remains largely unaffected,” he said.
Retail diesel prices at state-run OMCs - Indian Oil Corporation, Hindustan Petroleum Corporation and Bharat Petroleum Corporation - as well as private retailer Reliance Industries, remain unchanged at Rs 92.40 per litre in the state.
Diesel sold by Nayara Energy, however, is priced at Rs 95.54 per litre, while outlets operated by Shell plc quote an even higher rate of Rs 124.66 per litre.
The shift has also tightened credit terms.
“Earlier, some oil marketing companies extended credit for three to five days. Now, they have reverted to stricter norms, effectively moving to a day-end credit cycle,” Murali said. Dealers receiving early morning supplies are now required to settle payments by the end of the day.
The changes have left around 25% of the dealers under strain, many of whom are resorting to short-term borrowing to maintain supplies and prevent stock-outs.
Oil companies have also advised dealers to maintain a minimum inventory of three days. “There is adequate fuel availability at present,” Murali said.
Tamil Nadu has more than 7,000 outlets operated by public sector OMCs, with average daily diesel sales of about 4,000 kilolitres.
Meanwhile, A Anbalagan, president of the All Omni Bus Owners Association, said the increase in bulk fuel prices has raised operating costs for omni bus operators by Rs 1,000 to Rs 1,500 per trip.
“We have not yet passed on the hike to commuters due to competition and strong seasonal demand,” he told TNIE, adding that larger operators with fleet of over 45 buses typically run their own refuelling stations.