BPCL starts rationing fuel supplies

Beginning June 24, Bharat Petroleum Corporation Limited petrol pumps across India are on “rationed” supply. BPCL has adopted the drastic system because of a severe cash crunch for buying oil products. Other oil majors such as HPCL and IOC are facing a cash crunch due to the government’s refusal to allow an increase in retail prices, which has been in the offing several times in the last few months. Amarjit Singh, vice-president of the Petro Dealers’ Association in Mumbai, said that BPCL petrol-pump owners were informed that every dealer would receive only a limited quota every month. If a dealer exhausts his quota within, say, 25 days, due to the growing demand for petrol from the ever-growing automobile sector, he has to shutdown for the remaining days of the month. The company has told dealers that the move is only aimed at extending the available products for a longer duration. A high-ranking BPCL official, requesting anonymity, confirmed that rationing has been done across the country and would, in effect, be initially for four to five months or less if the issue of payment is resolved earlier. (May 22, 2008)