Govt Freezes Petrol Prices; Industry Suffering Major Losses

| Updated: June 20, 2022 11:53 am

The Federation of Indian Petroleum Industry (FIPI) said that it had written to the Ministry of Petroleum and addressed the concerns currently plaguing the industry in the country. Director General of FIPI Gurmeet Singh wrote in the letter that private companies were suffering huge losses as they had to sell petrol-diesel at less than international rates. There has been no increase in retail fuel prices since April 6. On the other hand, the price of fuel for wholesale buyers, such as state transport enterprises, has risen in line with international market prices. However, this is not helping the companies as these buyers to have started purchasing fuel from retail units to maintain costs. This has resulted in further losses for private companies.

Over the past month, petrol and diesel is making headlines for several reasons. Lately, petrol is in the news for shortage of stocks. Throughout India, petrol pumps were seen rationing the quantity of petrol that customers could buy. States like Gujarat, Madhya Pradesh, Rajasthan, Karnataka, Tamil Nadu, Chattisgarh, Odisha, and Kashmir were most affected. In March and even April petrol prices saw a significant hike as the international price of crude oil rose.

Now, however, since early April prices have been for the most part stable. This is not because the international prices are stable but because the government has frozen the petrol prices. This is causing major problems for private companies. The industry players are unable to raise the petrol prices even though the international prices of crude oil are rising. This is harming the companies, which are suffering big losses each day.  The companies are currently suffering a loss of Rs20-25 for every litre of diesel and Rs14-18 for every litre of petrol.  

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