The Union Government’s decision to de-regulate petrol and diesel prices is likely to see the re-entry of private fuel retailers such as Reliance Industries, Essar Oil, Shell Petroleum and others.
Consumers will benefit as increased competition may see the prices of petroleum products falling, as private and public players jostle to woo consumers and gain market share.
A senior petroleum ministry official told HT that consumers will now have a choice to buy petrol and diesel from outlets of their choice. “They will get the services they deserve. Both public and private companies will be under pressure to provide the consumers with the best services, which will ultimately even lead to lower prices,” the official said.
Private companies that have licence to retail petrol and diesel includes RIL, Essar Oil, ONGC-owned MRPL, Numaligarh Refineries and Shell Petroleum.
RIL had set up 1,400 petrol pumps but shut them as the government was subsidising the fuel sold by state-owned oil marketing companies at a time when oil prices were high globally. Essar Oil slowed down operations at its 1,342 outlets.
Naresh Nayyar, MD & CEO, Essar Oil, and CEO of Essar Energy told HT, “The move will benefit the consumer in the long run through competitive pricing of fuel products and an offering of better services.”
“As the largest active private sector fuel retailer in India, we are well placed to capture additional sales for fuel and non-fuel items and expect to see significant volume growth in both areas,” he said.
Essar Oil has already worked out plans to significantly increase its fuel retail outlets, he said.
Ashok Sinha, chairman and managing director of public sector BPCL, said, “We will move towards competitive prices. Each company will ultimately be able to set their own prices.”
ONGC chairman and managing director, R S Sharma, who is also chairman, MRPL said, “The decision will provide a good start to our retailing operations.” ONGC at present has three petrol pumps.
MRPL, a subsidiary of ONGC, has been waiting to expand its presence in petroleum retailing.