Bulk users have now been directed to source fuel only through their designated consumer pumps, with states and oil companies instructed to enforce the restrictions. | Photo Credit: SHIV KUMAR PUSHPAKAR

In a significant development, the government has said that a retail fuel outlet can sell up to 200 litres of diesel per person per day to curb black marketing and hoarding by unscrupulous elements.

Besides, industrial and commercial users of diesel, also called bulk users, cannot purchase petrol and diesel from retail outlets.

Bulk users directed to buy fuel from dedicated consumer pumps

The current situation is one of uneven, extraordinary demand growth in some retail outlets, driven by the shifting of bulk diesel volumes to PSU Oil Marketing Retail Outlets.

This is driven by industrial and direct (institutional and commercial) consumers who have been shifting their procurement from dedicated consumer pumps to retail outlets due to the difference between bulk and retail diesel prices. This resulted in petrol bunks in several parts of the country, specifically in Maharashtra but also in parts of Punjab and Gujarat, reporting fuel shortage and long queues.

The other reason is that private oil marketing companies’ sales exhibited a decline of around 58 per cent in HSD sales during May 2026 due to higher prices fixed by them, the Oil Ministry said in a statement.

Surge in PSU retail outlet diesel sales triggers action

The data for May 2026, compared with the corresponding period last year, reveals a significant surge in diesel sales through PSU OMCs’ retail outlets, with 327 districts recording more than 10 per cent growth, and 80 districts exceeding 30 per cent.

“Institutional & Direct or Industrial & Commercial customers shall not procure or cause to be procured MS and/or HSD from Retail Outlets and shall only source their MS/HSD requirements from their own consumer pumps. Retail outlet dealers shall dispense HSD only in a vehicle tanks, or PESO-approved containers, and not exceeding 200 litres in a day to a customer/vehicle and this HSD cannot be resold,” said a government notification.

Oil companies asked to ensure compliance

Oil marketing companies and retail outlet dealers shall ensure compliance with the restrictions imposed under Section 3 and prevent its circumvention.

Any order issued under this provision can be issued only for an initial validity period not exceeding 90 days from the date of issue or till revoked by another order, whichever is earlier, it added.

The measures are aimed at large/bulk consumers who should not be procuring diesel from Retail Outlets to take undue advantage of the price arbitrage.

Action planned against hoarding and resale

Blatant instances of procuring large quantities of diesel in jerry cans and reselling them have come to the Government’s notice. This order will enable strict action against such buyers/operators, dealers, and officers involved in black marketing and hoarding of diesel.

Further, if the order is not revoked, prior to its expiry, then for it to remain in force beyond the initial period, it shall have to be extended by another order, and it shall remain valid for a period as may be prescribed in the extension order, the Ministry of Petroleum & Natural Gas (MoPNG) said in the notification.

States and UTs directed to enforce restrictions

In directions to states and union territories, the Ministry said states and UTs shall take all necessary measures to implement this order, including action against hoarding, black marketing, unauthorised procurement, diversion and other malpractices relating to Motor Spirit and High-Speed Diesel under the Essential Commodities Act, 1955, the Motor Spirit and High Speed Diesel (Regulation of Supply, Distribution and Prevention of Malpractices) Order, 2005 and other applicable laws.

Published on June 12, 2026