Automotive fuel retailing, the fiefdom of state-owned oil marketing companies is now witnessing private operators including Essar and Shell expanding their footprint steadily.
Automotive fuels were under administered prices with an aim to protect the customers from sudden price shocks. In June 2010, petrol prices were opened up to market prices, with state owned retailers told to revise prices once a fortnight. Subsequently, diesel prices were deregulated in October 2014 and which was followed by opening up both for daily price revisions by retailers.
Between April and December, private sector companies operated 7,203 pumps, of which 630 of them were added by Essar and Shell while Reliance didn’t add any in that period. India had 67,440 fuel stations as of December 2019, an increase of nearly 4%.
“Nearly 50% of our products and revenues comes from retail operations from petrol pumps. We will fiercely guard our territory and will not yield any ground to any one,” said P Jayadevan, executive director of TN & Puducherry of Indian Oil Corporation. He said that his office was processing new pump applications from nearly 2,000 applicants and he expected at least a fourth of them to start operations over the next year. “We have already issued 250 letter of intent (LoI) from new applicants across the state and work is progress,” he said. “We are leaders in that space, we will not slacken.”
Be that as it may, between April and March, Essar opened 600 new stations across India. Shell operated 175 pumps as of December 2019 as against 145 in March. “Shell Retail has been consistently growing its presence in India. We are now present in over 40 cities and towns across the country. We have expanded our network in existing cities like Bengaluru, Chennai, Ahmedabad. and have also entered new cities like Hubli-Dharwad, Coimbatore, Nashik, Bhavnagar, Jamnagar to name a few,” a Shell India spokesperson said. Reliance fuel network remained stagnant at 1,400 outlets between April and December. “There has been a slowdown in new vehicle sales over the past few. But, the long term prospects are still promising. Besides, newer avenues like opening battery swapping operations for electric vehicles in existing outlets throws in an opportunity to catch the EV space too,” a marketing official at BPCL said. State owned oil marketers pay dealers a commission of Rs 3.2 per litre of petrol and Rs 2.25 a litre of diesel. The commission is fixed by the oil ministry.Share This