There is no shortage of petrol or diesel anywhere in the country, Sukhmal Kumar Jain, former Marketing Director of Bharat Petroleum Corporation Limited (BPCL), said on Sunday, 24 May, adding that public sector oil marketing companies (OMCs) are fully managing fuel supply and consumption across India. His remarks came amid scattered concerns about fuel availability in certain areas.

PSU Dominance Ensures Steady Supply

Jain pointed to the sheer scale of the public sector network as the primary stabiliser. PSU oil marketing companies operate approximately 85,000 retail outlets out of nearly one lakh fuel stations nationwide — a market share that, according to him, makes system-wide shortages highly unlikely.

'I don't think there is any shortage because as far as the consumption part is concerned, it is being fully managed by the public sector oil marketing companies,' Jain said. He acknowledged that isolated incidents may occur for localised reasons, but maintained these do not reflect a structural supply gap.

Volatile Global Costs Squeezing OMCs

While supply remains intact, Jain flagged mounting financial pressure on oil companies. He described the current market environment as 'very volatile', citing a convergence of cost escalations — crude oil price swings, rising shipping costs, higher insurance premiums, and a depreciating rupee.

On the currency front, Jain noted that exchange rates, which were earlier around 89–90 to the dollar, are now hovering near 96, materially increasing the import burden on OMCs. The combined effect of these factors, he said, has pushed daily losses at oil marketing companies to between ₹600 crore and ₹700 crore per day.

Supply Commitment Despite Margin Pressure

Despite absorbing these losses, Jain emphasised that PSU oil companies remain committed to uninterrupted supply. This is consistent with the historical role of state-run OMCs — Indian Oil Corporation (IOC), BPCL, and Hindustan Petroleum Corporation Limited (HPCL) — in prioritising energy security over short-term profitability, particularly during periods of global commodity stress.

This comes amid a broader pattern of OMCs delaying retail price revisions even as international crude benchmarks remain elevated, a dynamic that has periodically strained their balance sheets. Notably, this is not the first time PSU oil firms have absorbed significant under-recoveries to shield consumers from price shocks — a practice that has drawn both praise for affordability and criticism for fiscal sustainability.

What to Watch

With exchange rate pressures persisting and global crude markets remaining unpredictable, the scale of daily losses at OMCs will be closely watched by investors and policymakers alike. Any decision on retail fuel price revision — or government compensation to OMCs — could emerge as a key policy question in the weeks ahead.