Centre Restricts Bulk Diesel Buying from Petrol Pumps to Prevent Shortages

The Centre has barred industrial, commercial and institutional consumers from purchasing diesel from retail fuel stations, seeking to protect supplies meant for ordinary consumers amid an abnormal surge in diesel sales at petrol pumps due to diversion from bulk channels.

In a notification issued on June 11, the Petroleum Ministry said industrial, commercial and institutional consumers have increasingly shifted to retail outlets to buy fuel because of the price difference between retail and bulk sales, leading to pressure on supplies intended for retail customers.

The ministry said it had observed that "abnormal increases in sales of Motor Spirit and High Speed Diesel through Retail Outlets in certain parts of the country are driven by shifting of industrial, commercial and institutional consumers to Retail Outlets owing to the price difference between retail and bulk sale prices."

According to the notification, this trend is resulting in the "diversion of supplies intended for retail consumers" and creating the possibility of "localised shortages and disruption of essential services to common man."

To address the issue, the Centre has issued the Motor Spirit and High Speed Diesel (Temporary Regulation of Supply through Retail Outlets) Order, 2026, under the Essential Commodities Act.

Why has the Centre restricted diesel sales from retail outlets to industrial and commercial consumers?

Under the order, the government can direct public sector oil marketing companies and other authorised fuel retailers to prevent institutional, industrial and commercial customers from sourcing petrol and diesel from retail outlets.

Such consumers will be required to meet their fuel requirements through their own consumer pumps.

The government has directed retail outlet dealers to dispense high-speed diesel only into vehicle tanks or Petroleum and Explosives Safety Organisation (PESO)-approved containers and limit sales to 200 litres per customer or vehicle per day.

"Retail Outlet dealers shall dispense HSD only in a vehicle tank, or PESO-approved containers, and not exceeding 200 litres in a day to a customer/vehicle and this HSD cannot be resold," the notification said.

The ministry said the measure was necessary because "such bulk procurement through Retail Outlets has the potential to adversely affect the availability of Motor Spirit and High-Speed Diesel for bona fide retail consumers and may lead to hoarding, diversion and other malpractices."

The notification linked the move to global developments, stating that the prevailing geopolitical situation affecting some regions of the world has impacted international petroleum supply chains, shipping logistics and the availability of petroleum products.

The government stated that any restrictions imposed under the order would initially remain valid for a period not exceeding 90 days unless revoked earlier or extended through a subsequent order.

The ministry said violations of the order would attract penalties under the Essential Commodities Act and other applicable laws.

(With inputs from ANI)