India restricts bulk diesel, petrol sales at retail outlets
Ninety-day curbs imposed after abnormal fuel demand growth
New Delhi — The Indian government has imposed strict restrictions on industrial, commercial, and institutional users buying petrol and diesel from regular petrol pumps, mandating that they source their fuel requirements exclusively from bulk sale points. This move, issued through an official order on June 11, will remain in place for up to 90 days and aims to prevent fuel shortages for ordinary consumers amid abnormal demand spikes.
The restrictions follow a surge in diesel demand in certain regions after bulk users began purchasing fuel from retail petrol pumps to exploit a significant pricing difference. In Delhi, diesel at petrol pumps costs Rs 95.20 per litre, while bulk sales are priced at Rs 134.50 per litre. This differential emerged because state-owned oil companies adjusted retail prices to shield common users from cost spikes triggered by the West Asia crisis in late February. Meanwhile, bulk users such as telecom towers, industries using diesel for power generation, and those requiring feedstock are charged at market prices, making retail pump rates substantially lower than the actual cost.
The Ministry of Petroleum and Natural Gas issued the Motor Spirit and High Speed Diesel (Temporary Regulation of Supply through Retail Outlets) Order, 2026, directing fuel retailers and oil marketing companies to curb bulk purchases from retail outlets for periods of up to 90 days at a time. The government stated the move was necessitated by the “current prevailing geopolitical situation affecting certain regions of the world,” which has adversely impacted international petroleum supply chains, shipping logistics, and the availability of petroleum products.
According to the notification, “abnormal increases in sales of Motor Spirit (petrol) and High Speed Diesel (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.” As a result, institutional, industrial, and commercial consumers may now be barred from procuring petrol and diesel from retail fuel stations and will instead be required to source supplies through their own consumer pumps.
The order also restricts diesel sales at retail outlets to vehicle fuel tanks or Petroleum and Explosives Safety Organisation (PESO)-approved containers, with purchases capped at 200 litres per customer or vehicle per day. Such diesel “cannot be resold,” the order explicitly stated. The government warned that bulk procurement through retail stations could divert supplies intended for ordinary consumers and “create the potential for localised shortages and disruption of essential services to the common man.”
The new framework empowers public-sector oil marketing companies and other authorised fuel retailers to enforce these restrictions. It also requires state governments and union territories to take action against hoarding, black marketing, unauthorised procurement, and diversion of fuel supplies. Restrictions imposed under this order can remain in force for an initial period of up to 90 days and may be extended through a fresh government order if necessary.
The government emphasized that the measures are aimed at ensuring “equitable availability” of petrol and diesel, preventing hoarding and diversion, and maintaining uninterrupted supplies across the country. The notification stated, “The Government may by a special order exempt any consumer, class of consumers, area, transaction, or category of transactions from all or any of the provisions of this Order,” adding that any violation shall be punishable under the provisions of the Essential Commodities Act.
State governments and Union territory administrations were directed to take “all necessary measures to implement” the order, including “action against hoarding, black marketing, unauthorised procurement, diversion and other malpractices.” This directive underscores the seriousness of the government’s commitment to protecting fuel access for everyday citizens while managing the pressures of global supply disruptions and domestic demand imbalances.
The order reflects a careful balancing act between protecting retail consumers from price volatility and ensuring that bulk users do not exploit retail pricing to undermine supply stability. By closing this loophole, the government hopes to prevent future disruptions and maintain fuel security during a period of heightened global uncertainty.