Indians Buying More Fuel Amid High Prices? Companies Plan To Double Number Of Pumps

State-owned Oil Marketing Company’s (OMC) Bharat Petroleum Corporation Ltd. (BPCL), Indian Oil Corporation Ltd (IOCL) and Hindustan Petroleum Corporation Ltd (HPCL) have announced plans to double the number of fuel pumps across the country, The New Indian Express. has reported.

The OMCs launched a publicity campaign for around 55,649 petrol dealership across the country. Currently, there are 62,585 petrol pumps operational in India. State-owned companies own a majority of the pumps and 6,000 pumps are owned by Reliance and Nyara energy.

The retail outlet network in rural, remote and far-flung areas are being expanded with the intention of supplying mainly high-speed diesel (HSD) and also other products to ensure quality and correct price to meet the demands of remote villages.

Out of the announced 55,649 dealerships, only 17 per cent have been commissioned till now as the investment required for a large format pump would cost Rs 6 to 8 crore. OMCs have refuted the allegations that output per pump has dropped, pointing out that it has increased to an average of 170 kilo litres.

“This looks more like an attempt to be there on all important areas, and pre-empt other players. From the retailer’s point, for PSUs, per pump productivity was low. Pay-back time is going to be longer for these new pumps,” senior vice president, ICRA K Ravichandran said while expressing concerns over profitability for the new retailers.

The Ministry of Petroleum is in the process of revising guidelines for retail marketing of transportation fuels with an intention to liberalise the marketing scenario and increase competition.