Deora temporarily bans opening of new petrol pumps

Indias Petroleum Minister Murli Deora has said the decision to ban opening of new petrol pumps by public sector oil marketing companies (OMC) for the next two years was taken to avoid undue competition among them and was not connected with losses suffered by these state-run companies. Deora said his Ministry issues directives periodically to the OMCs to maintain healthy competition. However, it does not mean that the opening of new petrol pumps is banned forever, adding that this will have no impact on the supply of petroleum products. ”We have to keep in mind that the petrol pumps [are located] at a certain distance from each other to avoid undue competition,” Deora said. This step was being seen in the light of the losses being incurred by these firms as the global crude oil prices soared, while the cap in domestic prices remained. Among the 35,000 petrol pumps across the country, the biggest company, Indian Oil Corporation, runs about 17,500, while the rest are owned by Bharat Petroleum and Hindustan Petroleum. Private firms Reliance and Essar also opened petrol pumps across the country, but were forced to shut down because they were unable to compete with subsidized retail oil prices being offered by state-run oil firms. (July 16, 2008)