Cooking gas distributors in the State have urged the oil marketing companies to reimburse the amount they have lost due to the sudden price cut announced by the Union Cabinet . Many distributors had purchased at least one load of cylinders, and paid for them in advance. However, they stand to lose ₹200 per cylinder as there is no talk of a refund of this amount.
P. Dakshinamurthy, general secretary, All India HP Distributors Federation, said that each load comprised 357 cylinders, and when you calculate per load, we stand to lose around ₹70,000. Some distributors had booked four loads, and overnight they lost ₹2.49 lakh. The overall loss to the 27,000 distributors across the country is estimated to be ₹550 crore, he added.
An Indane distributor said small distributors who sold less than 100 refills and had stored 300 bottles were affected. “For customers who had paid through online mode, we are now returning ₹200 each in cash. The price effective from August 30 is only ₹918 per domestic cylinder. They had paid ₹1118,” he added.
A distributor said the Minister had announced that the Ministry would absorb the losses to the OMCs due to the reduction. “When this is the case, why can’t the OMCs pass on the amount to us? The companies can see our stock and the transit bottles at any point in time. Even during hikes in the price of cylinders, we are willing to take the amount from customers and return it to the oil companies,” he said.
An oil industry expert explained that according to the Price Protection Act, it is enough if distributors keep one day’s stock. However, oil companies force distributors to take more than what is required, which is why the loss to distributors is higher. “When prices change, be it a hike or a reduction, the burden should not be passed on to distributors,” the expert claimed.
