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Wed May 21, 2008

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May 09, 2008 (Datamonitor via COMTEX) -- Poor sales have forced Reliance Industries to close all of its 1,432 petrol stations in India, reported The Press Trust of India.

Murli Deora, India's Petroleum Minister, said: "Reliance has informed that sales at their retail outlets was negligible due to selling price differential between private and public sector ROs, leading to the closure of all their 1,432 pumps in the country with effect from March 15."

At present, the public sector sells petrol at a loss of INR13.97 a liter and diesel at a discount of INR20.97 per liter. However, this loss is compensated by the government through issue of oil bonds and subsidy share from upstream firms.

As private companies like Reliance did not have the right to avail the subsidy, the price of fuel at their pumps was INR8-10 higher than the prices at public sector-owned fuel stations.

Apart from Reliance, Shell India and Essar Oil are the other private players in the retail sector. These companies have not closed their petrol stations.

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