State-owned oil marketing companies are unlikely to continue with the current system of fortnightly revision in petrol prices on 1st and 15th of every month and may move back to the earlier system of adhoc revision in fuel prices.
Pump dealers had started timing their purchases of petrol in line with oil firms’ moves.
The expectations of a R2 a litre reduction in petrol prices on Friday saw petrol pump dealers across the country cut their daily purchases of petrol from the depots in the past two days. Dealers are keeping low petrol stocks assuming that people would not lift their regular requirement on the days preceding Friday and wait until the price decreased.
Shortage of petrol at various pumps was also witnessed causing inconvenience to customers.
“The scarcity of petrol if any is artificial,” the chairman of an oil company said on the condition of anonymity. “Usually when the date of price revision is known to the dealers, they either do not place orders or resort to lower purchases because it would result into loss for them as they would be paying the old price of petrol and selling it at a reduced price from Saturday onwards.”
“Petrol pump owners have to pay the VAT component of the price at the time of purchasing the fuel,” said Ajay Bansal, All India Petrol Pump Dealers Association. “To avoid having to purchase petrol at a high price and then sell it at a lower price they avoided placing orders.”
Another oil company official disclosed said that consultations were on to keep the date of revision under wraps to avoid any inconvenience to the consumers. “We may have to move back to the ad hoc mechanism to revise fuel prices.”