With the fuel price set to rise by Rs 1.82 a litre next week, city pump owners fear incurring losses amounting to Rs 300 crore; now demand better profit margin
Whenever petrol prices are hiked, angry commuters tend to vent their anger at pumps, unaware of the fact that these pumps are subjected to spiraling losses after every price hike and also share the same sentiments about the government's 'obsession with jacking up fuel prices on a whim'.
As the Centre is set to increase the price of petrol by Rs 1.82 per litre from next week, making it the fourth
hike this year so far, people as well as pump owners have already started feeling the heat, literally.
According to experts, the imminent hike will subject the petrol bunks to suffer a loss of around Rs 300 crore. Besides, the pumps also lose out on around Rs 150 crore to fuel adulteration annually.
"Price hikes benefit none, except the government. If people think that we are making a lot of money due to hikes, then they are mistaken.
Our association has been asking the government for a margin of Rs 5 per litre, but it has been fixed to Rs 1.8 per litre. Each time there is a petrol price hike, the price of daily commodities also goes up, but our margin doesn't change. As the prices go up, the percentage we receive goes down.
In fact we are subjected to losses," said Bhushan Narang, President, Bangalore Petroleum Dealers' Association.
Owners of petrol bunks, situated at prominent locations in the city, admitted that sales do go up as demand rises before price hikes, but this trend dies down soon. "Our profits are subject to stock available.
The demand rises with each hike, but after cutting VAT, handling and evaporation losses, wages of employees, electricity costs and sundry expenses, we end up with almost nothing in hand. It isn't a profit making business like the common man assumes," said Venkatesh, manager, DM and Sons Petrol Bunk, Airport Road.
Even though they face losses, they are now complaining that they have to deal with the fury of the common man as well.
"Often we get abused each time there is a hike. People divert their anger towards us and don't understand that we are probably suffering more than them," said Murthy, an official at the Brigade Road Petrol Bunk.