Production of petrol, diesel more than sufficient to take care of demand surge: Govt

The Ministry of Petroleum and Natural Gas (MoPNG) has stated that the production of petrol and diesel in the country is more than sufficient to take care of any demand surge. The ministry said this in light of a massive increase in demand for petrol and diesel during the first half of June.

Petrol sale between June 1 and 14 was 54.2 per cent higher than the same period last year as demand recovered from a relatively low base in 2021 when the world's third-biggest oil user was in the grip of the second wave of COVID-19. While diesel saw sales jumping 47.8 per cent year on year to 3.4 million tonnes between June 1-14, preliminary industry data showed on Wednesday.

The ministry added that in the past few days there has also been a big increase in instances of rush at the state-owned (PSU) retail outlets, leading to delays and increased waiting time for customers. This, the ministry explained, has led to speculation of supply constraints by the public sector oil marketing companies.

Rajasthan, Madhya Pradesh and Karnataka are the states where the sharp increase in demand was particularly noticed, it stated. The ministry explained that these were the states where a large quantity of supply was being done by retail outlets belonging to private marketing companies and where the distances from supply locations such as terminals and depots are longer. 

The ministry noted that the increase in demand has been on account of the seasonal surge in demand due to agricultural activities, bulk buyers having shifted their purchases to retail outlets, and a substantial reduction in the sales by private marketing companies with their substantial volumes having shifted to PSU retail outlets. 

"This unprecedented growth has created some temporary logistics issues at the local level," the petroleum ministry noted. "The companies are ensuring that sufficient supplies of Petrol and Diesel are available to cater to this extra demand, and they are committed to fulfill the energy needs of the nation," it added.  

It further explained that the oil firms are tackling these issues by increasing the stocks at the depots and terminals; extra movement of tank trucks and lorries to serve the retail outlets; extended working hours of depots and terminals including at night, to cater to the extra demand, and provision of extra quantities of fuels for supply in the affected states.

(With PTI inputs)

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