Oppose the privatisation of petroleum sector to avoid shortage of petrol and diesel


By Ashok Kumar, Joint Secretary, Kamgar Ekta Committee (KEC)


A glimpse of what havoc the large scale privatisation of petroleum sector will cause, can be seen right now in a few parts of the country. There is shortage of petrol and diesel in many states like Rajasthan, Madhya Pradesh, Gujarat and Tamil Nadu. The shortage is not due to inadequate production of petrol and diesel. It is because private refining companies like Reliance and Nayara have closed down their pumps or have reduced supplies to their retail outlets.

The most affected states are those where pumps of private companies are in significant number. In Rajasthan, outlets of private refineries supply 15%-17% of fuels. In the state, 1,275 out of 6,475 retail outlets for petrol and diesel are of private refineries. Similarly in Madhya Pradesh, 500 outlets out of the total 4,900 belong to private refineries. Long queues at petrol pumps are reported in these states. Farmers have been particularly badly affected as they require diesel for their farming operation now that the monsoon season is beginning and the crops have to be sowed.

Private refineries have diverted the supply of petrol and diesel from the domestic market to international markets to take advantage of very high petrol and diesel prices in Europe and USA due to the Ukraine war and earn super profits

While the private sector has cut down supplies, public sector refineries have been asked by the government to increase supply in the affected states to make up for the shortfall. So once again public sector has been asked to come to the help of people.

There are also reports that while private refiners are using cheaper crude oil supplied by Russia to India for its domestic needs, they are exporting the refined products and earning bumper profits instead of supplying to the domestic market.

At present public sector refineries have the dominant share of the retail market of petrol and diesel. Even with a small share of market, the private petroleum sector has caused a crisis in many parts of the country. If public sector petroleum companies like BPCL, which have a large share in domestic market, are privatised, we can imagine what havoc would be created in the lives of people by the private sector.

The actions of private refiners once again show that the private sector cannot be relied upon to meet the needs of society and of people. The private sector works only to maximise profits.

The privatisation of the petroleum sector will be anti-people and anti-national is confirmed once again. Privatisation of existing public sector refineries will lead to even more severe and frequent fuel shortage in the coming days besides unaffordable fuel prices.

Both workers and consumers will have to intensify the opposition to privatisation of the petroleum sector to ensure that basic fuel needs of people are satisfied at affordable prices.



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