Global Diesel Squeeze Hits Indian Fuel Retailers
Disruptions in West Asia and Russia have tightened refined diesel supplies, prompting private retailers to limit purchases as industrial buyers shift to petrol pumps.
A global squeeze in diesel supplies is putting pressure on fuel markets as disruptions in West Asia and Russia reduce the availability of refined products. The impact is increasingly visible in India, where industrial and other bulk consumers are turning to retail petrol pumps for diesel, prompting some private fuel retailers to introduce purchase limits.
Jio-bp has capped diesel purchases at 50 litres per customer per day at its mobility stations, while Nayara Energy has set transaction limits ranging from 70 litres to 200 litres. The restrictions come as bulk users seek cheaper retail diesel amid a widening price gap between retail and directly supplied industrial fuel.
KEY HIGHLIGHT
West Asia's diesel exports fell by half between March and August from a year earlier, averaging about 800,000 barrels per day, according to Kpler shipping data.
The supply pressure extends beyond crude oil. The ongoing US-Iran conflict has disrupted fuel flows from the Gulf, while attacks affecting Russian refineries have reduced another major source of diesel exports. Shipping disruptions around the Strait of Hormuz and the Red Sea have further complicated the movement of refined fuels.
According to Reuters data cited by Business Standard, US retail diesel prices crossed $6 a gallon for the first time on record this month, while an Asian diesel benchmark reached around $180 a barrel on September 18. In the UK, diesel prices rose to a record 199.18 pence per litre on September 28.
BY THE NUMBERS
The International Energy Agency estimates that lost global refining throughput has reached 4.7 million barrels per day compared with 2025, tightening supplies of refined fuels.
India has kept retail petrol and diesel prices unchanged since May, even as international crude and refined-product prices have risen. Diesel supplied directly to industrial and other bulk consumers, however, has moved more closely with international prices, creating a gap of as much as Rs 40 per litre between bulk and retail diesel.
The price difference has encouraged factories, manufacturing units, telecom companies, hotels, malls, data centres and hospitals to buy diesel from retail outlets, with some bulk consumers purchasing 400 to 600 litres at a time. Since individual petrol pumps have limited storage capacity, the sudden increase in demand can make replenishment more difficult.
Jio-bp said its mobility stations remained operational and adequately stocked, adding that the measures were intended to ensure equitable fuel availability amid changing demand. Business Standard reported that there were no current reports of customers facing difficulty or delays in obtaining diesel, while the situation could ease if global supplies improve, refinery output increases or industrial buyers return to dedicated bulk-fuel channels.