Economy

No fuel crisis in India; enough stock available to last lockdown: IOC

PTI New Delhi | Updated on March 29, 2020 Published on March 29, 2020

Indian Oil Corp Chairman Sanjiv Singh

India, the world’s third-largest energy consumer, has enough petrol, diesel and cooking gas (LPG) in stocks to last way beyond the three-week nationwide lockdown as all plants and supply locations are fully operational, Indian Oil Corp (IOC) Chairman Sanjiv Singh said.

Singh, who continued to oversee the mammoth operations of ensuring that fuel reaches every nook and corner despite bereavement of his father on the day 21-day lockdown was declared, said there is no shortage of any fuel in the country and customers should not resort to the panic booking of LPG refills.

“We have mapped demand for all fuel for entire the April and beyond. We have refineries operating at levels enough to meet all of the demand. Besides all bulk storage points, LPG distributorships and petrol pumps are functioning normally. There is absolutely no shortage of any fuel,” he told PTI.

The nationwide lockdown that has shut businesses, suspended flights, stopped trains and brought almost the entire vehicular movement to a halt, has impacted fuel demand with petrol, diesel and aviation turbine fuel (ATF) showing negative growth (degrowth or fall in demand).

With most cars and two-wheelers going off the road, petrol demand has fallen by 8 per cent in March while diesel demand has been down 16 per cent. ATF demand has fallen by 20 per cent, he said.

“LPG consumption, however, continues to grow, and we are servicing all customers,” he said adding refill demand saw more than 200 per cent jump as the lockdown was announced.

The refills sought were a result of panic booking as in the absence of the exhausting existing ones, many could not take deliveries of new cylinders, he said adding even customers with double cylinder connections had ordered for refills without exhausting even one cylinder.

“There is absolutely no need for panic booking. We have enough stocks to meet all demand,” he said.

“When a customer resorts to panic booking, it puts unnecessary strain on the system as the requirement is immediately transmitted to bottling locations which make additional refills, transport it to bulk location and onward to the distributor.

“Distributors use already stretched delivery boys to physically deliver the cylinder to customer’s home only to return back with the filled cylinder as the customer refused delivery because existing ones hadn’t exhausted.”

Singh said due to lower demand of liquid fuels, refinery run-rates have been lowered by 25-30 per cent - meaning they would produce up to 30 per cent less of all fuel - petrol, diesel, ATF, naphtha and LPG.

Every barrel of crude oil when processed produces a certain percentage of petrol, diesel, kerosene/ATF and LPG. So, lower processing of crude would result in lower production of all fuel.

“To make up for the shortfall in LPG production, we have tied up for imports to meet the requirement of entire April,” he said. “We have mapped requirement of LPG for all of April, including the additional demand that would come from the government’s announcement of free cooking gas for three months to over 8 crore Pradhan Mantri Ujjwala Yojana beneficiaries.”

On March 26, the government announced a Rs 1.7 lakh crore package to deal with hardships caused by the lockdown. This involved giving free foodgrain and 3 LPG cylinders from April to June to poor.

“We may need 850,000 tonne of additional LPG, and we have tied up an import for all of it,” Singh said.

“To make lockdown a success, LPG is the key as without cooking fuel, people would not stay home. So we have made adequate arrangements to make it available,” he said.

IOC supplies to nearly half of the 27.59 crore active LPG customers.

“The terminals and depots, LPG distributorships and fuel stations are well-stocked Customers are advised not to panic or resort to hoarding and panic-buying or visit the showrooms and godowns of their LPG distributorships for obtaining refills,” he said.

For the past 10 days, IOC has been delivering on an average of 25 lakh cylinders every day to the doorsteps of its customers. All state-run fuel retailers together deliver about 52 lakh refills throughout the country.

All 119 Aviation Fuel Stations of IOC across the country are operating with optimum strength and full safety precautions to meet the aviation fuel (ATF) needs of defence aircraft, cargo flights and medical ambulances.

Singh said despite the challenges posed by Covid-19 lockdown, IOC is fully geared to maintain a smooth supply of petroleum products to its customers. The firm has put in place robust plans for petroleum movement and stocks at upcountry locations.

Even in the face of restricted movement of people and vehicles, IOC is ensuring loading of petrol, diesel and LPG at its bulk storage/distribution points with optimised workforce.

Published on March 29, 2020

A letter from the Editor


Dear Readers,

The coronavirus crisis has changed the world completely in the last few months. All of us have been locked into our homes, economic activity has come to a near standstill. Everyone has been impacted.

Including your favourite business and financial newspaper. Our printing and distribution chains have been severely disrupted across the country, leaving readers without access to newspapers. Newspaper delivery agents have also been unable to service their customers because of multiple restrictions.

In these difficult times, we, at BusinessLine have been working continuously every day so that you are informed about all the developments – whether on the pandemic, on policy responses, or the impact on the world of business and finance. Our team has been working round the clock to keep track of developments so that you – the reader – gets accurate information and actionable insights so that you can protect your jobs, businesses, finances and investments.

We are trying our best to ensure the newspaper reaches your hands every day. We have also ensured that even if your paper is not delivered, you can access BusinessLine in the e-paper format – just as it appears in print. Our website and apps too, are updated every minute, so that you can access the information you want anywhere, anytime.

But all this comes at a heavy cost. As you are aware, the lockdowns have wiped out almost all our entire revenue stream. Sustaining our quality journalism has become extremely challenging. That we have managed so far is thanks to your support. I thank all our subscribers – print and digital – for your support.

I appeal to all or readers to help us navigate these challenging times and help sustain one of the truly independent and credible voices in the world of Indian journalism. Doing so is easy. You can help us enormously simply by subscribing to our digital or e-paper editions. We offer several affordable subscription plans for our website, which includes Portfolio, our investment advisory section that offers rich investment advice from our highly qualified, in-house Research Bureau, the only such team in the Indian newspaper industry.

A little help from you can make a huge difference to the cause of quality journalism!

Support Quality Journalism
This article is closed for comments.
Please Email the Editor
You have read 1 out of 3 free articles for this week. For full access, please subscribe and get unlimited access to all sections.