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Production of fuel more than sufficient to take care of demand surge: Govt

The government stated on Wednesday that there is more than enough petrol and diesel produced in India to meet any increase in demand, dispelling rumours of scarcity.

The explanation comes in response to complaints of fuel shortages in many states throughout the nation, including Madhya Pradesh, Uttarakhand, Rajasthan, and Gujarat. There has reportedly been a significant rise in rush hours at PSU retail locations in several places, which has caused delays and longer customer wait times. The public sector Oil Marketing Companies (OMCs) have then speculated that there are supply bottlenecks.

‘The production of Petrol and Diesel in the country is more than sufficient to take care of any demand surge. This unprecedented growth has created some temporary logistics issues at the local level. Oil Companies have geared up to tackle these issues by increasing the stocks’, the Ministry of Petroleum & Natural Gas said in a press release.

In a few states, like Rajasthan, MP, and Karnataka, the demand for petrol and diesel has significantly increased. In the first part of June, the growth reached a peak of 50% YoY. According to the ministry, these are states where a significant portion of supply was carried out by stores that belonged to private marketing firms and where terminals and depots were farther away from supply sources.

‘In general, the increase in demand has been on account of the seasonal surge in demand due to agricultural activities, bulk buyers having shifted their purchases to retail outlets, and a substantial reduction in the sales by private marketing companies with their substantial volumes having shifted to PSU ROs. Simultaneously, as a result of a crackdown by the government on illegal bio-diesel sales, these volumes have also been added to the RO Diesel sale’, the Ministry added.


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