Loading of bulk LPG for Indian Oil Corporation (IOC) from multiple refineries to bottling plants across southern India was disrupted on Monday morning after transport operators halted operations, citing long-pending payments and unsettled toll claims by IOC.

K. Sundarrajan, President of the Southern Region Bulk LPG Transport Owners’ Association, Namakkal, said nearly 1,000 tanker trucks stopped loading from early morning. “The dues are worth nearly ₹50 crore,” he told businessline.

The affected supply chain includes refineries in Chennai, Palakkad, Thoothukudi, Mangaluru and Bengaluru, with each tanker typically carrying around 18 tonnes of LPG.

Sundarrajan said that payments for completed trips have been delayed for an extended period despite submission of all required documents. In addition, toll reimbursements have reportedly remained unpaid for the past five years, leading to significant financial stress among operators.

Sundarrajan also raised concerns over deductions under the new 2025–2030 transport contract. “Although bank guarantees were duly submitted, amounts ranging from ₹10 lakh to ₹18 lakh per transporter have been deducted without valid reason or prior intimation,” he claimed.

According to him, the association had met senior officials of Indian Oil Corporation on April 9 to present their grievances, but no corrective action has been taken so far. The issue appears to be a finance department error, stating that any discrepancies should have been communicated to transporters for rectification rather than unilateral deductions, he said.

Highlighting the operational strain, Sundarrajan said running a tanker for 1,000 km requires a minimum working capital of ₹60,000 to cover diesel, driver allowances, tolls and maintenance. “Without timely payments, it is becoming extremely difficult to continue operations smoothly,” he said.

The association has demanded immediate release of pending transport payments, clearance of toll claims, refund of deducted amounts, and transparent communication regarding any bank guarantee discrepancies.

In a communication to IOC officials early this month, the association warned that if dues are not cleared within 10 days, transporters could face an “unavoidable operational crisis,” holding the company responsible for any further disruption.

IOC is yet to comment on this.

Published on April 27, 2026