Business Daily from THE HINDU group of publications
Thursday, Jul 27, 2006
Business Daily from THE HINDU group of publications Thursday, Jul 27, 2006 |
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Industry & Economy
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Petroleum Corporate - Performance
Our Bureau
Kolkata , July 26 Reliance Industries has witnessed an 80 per cent drop in diesel sales and 50 per cent drop in motor spirit due to pricing strategy. The company had captured over 14 per cent of the country's retail diesel sales through 1,200 outlets by the end of last year. According to sources, the company's retail diesel sales had dropped from13,000-14,000 kilo litre (KL) to 2,000-3,000 KL per day as the fuel sold by Reliance outlets are dearer by Rs 2.5 a litre compared to the rest of the industry. The higher price structure was reportedly adopted in the face of mounting under-recoveries, government control over domestic prices through the oil PSUs and lack of government support to private sector vis-à-vis the public sector. Meanwhile, to compensate losses to its auto-fuel retailers, Reliance had enhanced the dealer's commission by 50 paise per litre. However, according to sources, the rise in commission could hardly compensate the loss incurred by the retailers due to drastic drop in sales. While the company has made a fresh appeal to the Union Ministry of Petroleum and Natural Gas for granting subsidies to cover up the losses in fuel retailing, the issue may snowball into a major tussle over LPG supplies at discounted prices to four oil PSUs, who are currently the sole recipient of Government support. Reliance is the single largest producer of LPG and had offered discounts worth Rs 750 crore in 2005-06.
Related Stories: More Stories on : Petroleum | Performance | Reliance Industries Ltd
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