Pumped out: Fuel dealers gasping for margins

Ludhiana: As retail fuel prices surge, petrol pump owners report a financial crisis driven by stagnant dealer commissions and ballooning operational overheads. Dealers warn that while they must invest significantly more working capital to maintain stocks at current high prices, their profit margins have failed to keep pace with the rising costs of electricity, staff salaries, and general maintenance.

Chairman of the Petroleum Pump Dealers Association, Ashok Sachdeva, emphasised that the sharp increase in fuel rates necessitates a proportional rise in commissions to cover the heavier investment burden. Dealers currently receive approximately Rs 3.8 per litre for petrol and Rs 2.4 per litre for diesel. They describe these rates as insufficient, noting that the last commission revision in 2024—a 65 paise hike for petrol and 44 paise for diesel—was largely considered minuscule and failed to account for years of inflation.

This frustration is compounded by the lack of periodic adjustments. Dealers pointed to the 2012 Apoorva Chandra Committee report, which recommended biannual commission reviews in January and July to account for changing operational costs. Despite these clear guidelines, the industry claims the recommendations remain largely unimplemented, leaving pump operators struggling to maintain profitability as their margins continue to decline.