Fuel Price Drop Likely As Petrol Pump Dealer Commissions See A Hike

On the auspicious occasion of Dhanteras, Oil Marketing Companies (OMCs) announced on Tuesday (October 29) a significant increase in the dealer commission paid to petrol pump operators. This decision is expected to lead to a decrease in petrol and diesel prices in various regions across the country. Additionally, OMCs will be rationalizing inter-state freight charges to assist consumers located in remote areas far from petrol and diesel depots.

Indian Oil Corporation (IOC) expressed satisfaction with the new dealer margins, which will take effect on October 30, 2024, following the resolution of ongoing litigation. The company emphasized that this change will not alter the retail selling prices of fuel products but will enhance customer service standards and support the welfare of staff at retail outlets. IOC stated, "Demonstrating our core value of 'Nation First,' we aim to provide affordable petrol and diesel across the country sustainably. The intrastate rationalization of freight will reduce the variation in retail selling prices across various markets within a state, except where the Model Code of Conduct is in effect."

States Where Petrol and Diesel Prices Will Decrease

As a result of the intra-state freight rationalization, petrol and diesel prices are set to decrease in states such as Odisha, Chhattisgarh, and Himachal Pradesh. Dealer commissions will vary based on sales and location, although specific details have yet to be disclosed. Currently, dealers receive ₹1,868.14 per kilolitre plus 0.875% of the billable price for petrol, while the commission for diesel stands at ₹1,389.35 per kilolitre plus 0.28% of the billable price.

Union Minister for Petroleum and Natural Gas, Hardeep Singh Puri, welcomed the OMCs' announcement. He noted, "I commend the decision to increase the dealer commission and undertake intra-state freight rationalization to benefit consumers in remote areas, resulting in lower petrol and diesel prices in several regions. This initiative will be implemented later in poll-bound states and constituencies." He highlighted specific price reductions in Kunanpally and Kalimela in Odisha's Malkangiri district, where petrol prices will decrease by ₹4.69 and ₹4.55, respectively, while diesel prices will drop by ₹4.45 and ₹4.32. In Chhattisgarh's Sukma, petrol prices will fall by ₹2.09, and diesel by ₹2.02. Additional cuts will occur in Bijapur, Bailadila, Kateykalyan, Bacheli, and Dantewada, as well as various locations in Arunachal Pradesh, Himachal Pradesh, Uttarakhand, and Mizoram.

Puri added, "The increase in dealer commission will enhance services for approximately 7 crore citizens who visit our fuel retail outlets daily, all without raising fuel prices. This long-awaited demand, pending for the last seven years, will bring joy and satisfaction to petrol pump dealers and the nearly 10 lakh staff working at over 83,000 petrol pumps nationwide."