Government caps retail diesel purchases at 200 litres per day per customer. Here’s why

The Ministry of Petroleum and Natural Gas has issued an order barring industrial, commercial and institutional consumers from purchasing petrol and diesel at retail fuel stations, directing them instead to source supplies through designated bulk sale points, as geopolitical disruptions and a domestic price differential sparked abnormal demand at pumps.

India bars industrial, commercial users from buying petrol, diesel at retail pumps 

The ministry issued the Motor Spirit and High Speed Diesel (Temporary Regulation of Supply through Retail Outlets) Order, 2026, directing fuel retailers and oil marketing companies to curb bulk purchases from retail outlets for periods of up to 90 days at a time. 

The notification restricts diesel sales at retail outlets to vehicle fuel tanks or PESO-approved containers, with purchases capped at 200 litres per customer or vehicle per day. Such diesel “cannot be resold,” the order said. 

Price gap between retail and bulk triggered the rush

The restrictions follow abnormal demand growth, particularly in diesel, after bulk users began purchasing from retail pumps due to a widening price gap. While diesel at petrol pumps costs Rs 95.20 a litre in Delhi, bulk sales are priced at Rs 134.50. 

The differential arose as state-owned oil companies modulated retail prices to insulate common users from the spike in cost that followed the West Asia crisis in late February. Bulk users such as telecom towers and industries using diesel for power generation are charged market price, while retail pump rates are well below cost. 

The government cited the “current prevailing geopolitical situation affecting certain regions of the world” as having adversely impacted international petroleum supply chains, shipping logistics and the availability of petroleum products. 

Order empowers OMCs, state governments to enforce

The order empowers public-sector oil marketing companies and other authorised fuel retailers to enforce the restrictions, and requires state governments and union territories to take action against hoarding, black marketing, unauthorised procurement and diversion of fuel supplies. 

The government said bulk procurement through retail stations could divert supplies intended for ordinary consumers and “create the potential for localised shortages and disruption of essential services to the common man.” 

Any restrictions imposed under the framework can remain in force for an initial period of up to 90 days and may be extended through a fresh government order. The government may also exempt any consumer, class of consumers, area or category of transactions from the provisions of the order. Any violation shall be punishable under the Essential Commodities Act. 

India’s oil marketing companies Indian Oil Corporation, BPCL and HPCL have publicly assured citizens that national fuel stocks remain adequate, saying they are maintaining more than 60 days of consumption in reserves.