Traders stop buying petrol in protest over excise cut

Deccan Chronicle.  | Sampat G Samritan

Nation, Current Affairs

Traders demanded a hike in the margin, last done in 2017, for dealers

Commuters wait to fuel their vehicles in Bengaluru, Monday, May 30, 2022. (Photo: PTI)

Vijayawada: Dissatisfied with the Centre’s recent decision to cut excise duty on fuels, petroleum traders in Andhra Pradesh suspended procurement of stocks from state-owned companies, between 8 am and 6 pm on Tuesday.

On average, nearly 3,600 fuel stations purchase 7-8 lakh litres of diesel and around 4.5 lakh litres of petrol daily, mainly from BPCL, HPCL and IOC.

Traders demanded a hike in the margin, last done in 2017, for dealers. At present, traders get a margin of Rs 1.88 and Rs 3.15 per litre of diesel and petrol, respectively.

Traders said that the dealer’s margin at present is insufficient to meet operational costs of fuel stations, with employees demanding salary hikes, increasing power tariffs and costs of maintenance works. They claimed that the trade will turn unremunerative if the margins are not increased.

AP Federation of Petroleum Traders general secretary P. Ravi Kumar said, “We have staged a protest in front of depots of oil marketing companies all over the state with a series of demands like upward revision of dealer’s margin in sale of fuels and we are going to hold a meeting with petroleum traders from 24 states shortly to chalk out an action plan on how to get our issues resolved by roping in the Centre.”

In case of a hike or dip in fuel costs implemented by the Centre, traders are unwilling to accept its impact, seeking a fixed margin.

In the latest round of excise duty cut, traders in the state lost around Rs 100 crore to Rs 120 crore, as they were forced to sell their stock at lower prices despite procuring the same for higher costs before the Centre’s announcement.

Traders said that cuts are generally higher, around Rs 8 - Rs 10, as compared to hikes, generally around Rs 25 paise to Rs 1. They said the government must hold a meeting with oil companies and traders to sort out the issues.

They also expressed concern over BPCL imposing cuts on the quantum of sale, causing artificial scarcity.

Consumers, however, as only a few fuel stations faced short supply.