Govt will continue to intervene in fuel pricing: Reliance-BP fuel retail CEO
Reliance BP Mobility CEO Harish Mehta stated that the government will continue intervening in domestic fuel pricing to protect consumers from international market fluctuations. While petrol was deregulated in 2010 and diesel in 2014, recent events have disrupted this alignment.
India freed up the pricing of petrol in 2010 and diesel in 2014, which allowed state-run fuel retailers to align domestic fuel rates with international markets and prompted private sector refiners to enhance their presence in fuel retailing.
After the outbreak of the Ukraine war in early 2022 sent international oil prices skyrocketing, state-run fuel retailers did not raise prices, breaking the alignment between domestic and international rates.
This caused private sector retailers to curtail sales at pumps for several months.
Even after international markets returned to normalcy, domestic prices did not revert to the previous practice of regular revisions to reflect international trends.
“The government will continue to intervene in the pricing of the fuel products,” Mehta said during a panel discussion on Thursday.
“We are a country which is not very rich, and the government is very cognizant of making sure that the impact of volatility which goes on in the international markets is not passed on to the Indian consumers.
” Mehta said the government’s handling of fuel pricing would impact the adoption of alternative fuels like gas or electric mobility.
Live Events India has too many petrol pumps, many of which are unproductive, Mehta said.
The country has about 95,000 petrol pumps, 90% of which are controlled by state-run companies.
“I strongly believe that India is an overpopulated fuel retail country,” he said, citing the case of Indonesia, which has only 9,000 fuel stations.
He said there was still “space for a differentiated network,” which could offer a good value proposition for customers.
Energy transition is “absolutely on the cards,” and no single fuel will dominate in the future, Mehta said, adding that petrol would peak by 2035, while diesel would last longer.
