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Diesel price hike for bulk users: PRTC snaps rebate pact with IOC, moves to retail market
The price of diesel sold to bulk users, including PRTC, has been hiked by about ₹25 per litre in line with a near 40% rise in international oil prices
Patiala: Following a hike in diesel prices by ₹25 per litre for bulk users, the Pepsu Road Transport Corporation (PRTC) has snapped its pact with the Indian Oil Corporation (IOC) over rebate issue.
With this, the state-run transport undertaking – PRTC – has moved to retail market for the purchase of diesel at market price to run its fleet of 1,113 buses across the state.
On March 21, the oil companies hiked price of diesel purchased by bulk buyers by ₹25 a litre due to high crude oil prices. The PRTC purchases diesel directly from the IOC under the pact. With the surge in prices for bulk purchasers, the PRTC would get diesel from IOC at ₹110.34 per litre. However, in retail, the corporation will get it at ₹85.34 a litre.
According to a memorandum of understanding (MoU) signed in 2020, the PRTC had struck a deal with the IOC for four years (till November 30, 2024) for rebate of ₹1.98 per litre on procurement of diesel in bulk.
“It has become financially unviable for the PRTC to get diesel from the IOC on rebate due to fluctuation and surge of diesel prices for bulk purchasers in the past three months,” said one of the senior officials.
An official added that though rebate on diesel helped corporation save ₹6 crore annually on the fuel expenditure in the past two years, things were different now, given the skyrocketing diesel prices in the global market.
The PRTC’s daily consumption of diesel is estimated at 90,000 litres.
Its managing director Parneet Shergill said the gap between retail and bulk purchase of diesel has been widening each passing day.
“It was ₹3.4 per litre on February 22 and ₹24.7 per litre on March 22. We could not continue to purchase diesel in bulk at this price. Therefore, the decision to purchase the fuel at retail price was taken after February 22,” Shergill said.
She added that being a public service provider, they have to ensure transportation is not hit.
“Several meetings were held with the IOC in the past one month to get diesel in bulk at retail price but the latter was reluctant,” Shergill said.
