New Delhi, May 11 -- India will not resort to fuel rationing despite prolonged global supply disruptions, the government said on Monday, even as state-run oil companies face daily losses of up to Rs 1,200 crore and Prime Minister Narendra Modi called on citizens to conserve fuel, cut imports and curb foreign exchange outflows.
At the Confederation of Indian Industry Annual Business Summit, Oil Secretary Neeraj Mittal sought to reassure markets and consumers, stating that fuel supplies remain stable and sufficient. "There is no need to panic. There are sufficient supplies. There is no rationing in place. It's not going to happen," he said, underlining that India has maintained around 60 days of fuel stocks and roughly 45 days of LPG inventories through nearly 10 weeks of global disruption.
The assurance comes against the backdrop of heightened geopolitical tensions in West Asia that have strained global energy flows and pushed up crude prices. Despite these pressures, petrol and diesel prices in India have remained unchanged for nearly two years. The decision to hold retail prices steady, even as input costs have surged by more than 50 per cent, has resulted in significant financial strain on public sector oil marketing companies, with estimated losses ranging between Rs 1,000 crore and Rs 1,200 crore per day.
Officials indicated that maintaining price and supply stability remains the government's default approach, even as it navigates the financial impact. Fiscal measures, including excise duty cuts on petrol and diesel, have been deployed to cushion consumers, with revenue implications estimated at around Rs 1.6 lakh crore.
Mittal said India has managed the crisis by diversifying crude sourcing, securing additional cargoes and increasing procurement from existing suppliers. He added that the country's large refining capacity has helped absorb shocks, ensuring domestic demand is met while exports of refined petroleum products continue.
"The constraint has not changed at all. In fact, it is a shade worse," Mittal said, referring to ongoing disruptions in global shipments. He noted that India successfully navigated logistical challenges, including moving 14 ships through the conflict-affected Strait of Hormuz during the period.
Alongside supply-side measures, the government has also implemented calibrated demand management. LPG distribution has been prioritised for household cooking needs, while industrial supply has been restored to about 70 per cent following requests from industry. Nearly full digital tracking of LPG deliveries has also helped curb diversion and black-market activity.
India, the world's third-largest oil consumer, uses about 5 million barrels of crude per day. While strategic petroleum reserves are part of long-term planning, Mittal said expanding them to cover 90 days of consumption would require significant capital. "For a country like India which consumes 5 million barrels a day, to have a 90-day reserve would be putting a lot of money in a box without using it at all," he said, adding that the government is exploring commercial models that allow stored crude to generate returns.
Parallel to the government's supply management efforts, Modi has urged citizens to play a role in easing pressure on the economy. Speaking at a public event in Vadodara, the Prime Minister called for reduced fuel consumption and greater reliance on public transport and electric vehicles. He also suggested reviving work-from-home practices where feasible and limiting non-essential foreign travel.
"The West Asia crisis is one of the worst in the decade. Just as we overcame the COVID-19 pandemic, we will come out of this also," Modi said, appealing for collective responsibility.
He further asked citizens to cut down on imports and avoid discretionary spending that drains foreign exchange reserves. In particular, Modi urged people to postpone gold purchases, noting that large volumes of foreign currency are used to import the precious metal.
"We must make every effort to reduce the use of imported products and avoid personal activities that involve spending foreign currency," he said.
The Prime Minister's remarks, delivered a day after a similar appeal in Telangana, signal a broader push for economic prudence amid external uncertainties. While some observers have interpreted the messaging as a precursor to possible price adjustments, officials have maintained that there is no immediate plan to alter fuel pricing or introduce rationing.
Government sources reiterated that India remains relatively stable compared to several countries that have imposed stricter demand controls or rationing measures. "Government uses all sorts of tools," Mittal said, describing India as "a relative oasis of calm" in a volatile global energy environment.
With global conditions still uncertain, authorities continue to balance supply security, fiscal pressures and consumer protection, while encouraging behavioural changes to reduce dependence on imports.
Published by HT Digital Content Services with permission from Millennium Post.