Fuel Rule Twist: Govt bars industries from buying petrol, diesel at pumps; Orders bulk purchasing system

New Delhi: The Center has issued a new directive restricting industrial, commercial and institutional consumers from purchasing petrol and diesel at retail fuel outlets. Instead, such users will now be required to procure fuel through bulk purchase channels, as part of efforts to streamline supply and prevent abnormal demand spikes.

Government Notifies Temporary Supply Order

The Ministry of Petroleum and Natural Gas has issued the Motor Spirit and High Speed ​​Diesel (Temporary Regulation of Supply through Retail Outlets) Order, 2026, directing oil marketing companies and fuel retailers to limit bulk purchases from petrol pumps for up to 90 days.

Government removes excise duty on ethanol-blended petrol up to 30%; What it means for fuel, farmers and India’s oil imports

Officials said the move aims to address “abnormal increases” in fuel sales at retail outlets in certain regions, driven by bulk users shifting to pumps due to price differences.

Why the Move Was Needed

According to the government, the shift of industrial and institutional consumers to retail outlets created pressure on fuel distribution networks. In Delhi, for example, diesel costs around ₹95.20 per liter at retail outlets, while bulk purchase rates stand significantly higher at ₹134.50 per litre.

This price gap encouraged large consumers- such as telecom operators and industrial units to move away from bulk supply channels and buy directly from retail stations.

Geopolitical Pressure and Supply Concerns

The notification cited global geopolitical tensions affecting petroleum supply chains, shipping routes and availability of fuel products. It said the situation required regulatory intervention to prevent disruptions and ensure stable supply for ordinary consumers.

Restrictions and Usage Limits Introduced

Under the new rules, institutional and commercial users may be barred from buying fuel at retail outlets altogether and will need to use dedicated consumer-operated pumps or authorized bulk supply mechanisms.

Jet fuel prices raised by 10% as oil firms introduce fixed-rate plan for Airlines

Additionally, diesel sales at retail points have been tightened. Purchases are limited to 200 liters per vehicle or approved container per day, and resale of diesel has been strictly prohibited. Authorities have also been empowered to act against hoarding, black marketing and illegal diversion of fuel.

Implementation and Enforcement

Public sector oil marketing companies, along with local authorities, have been tasked with enforcing the order. State governments and Union territories will monitor compliance and take action against violations under the Essential Commodities Act.

The order will remain in force for 90 days initially and may be extended depending on market conditions.