New Delhi: The Government has notified a temporary control order to prevent black marketing, hoarding and unauthorized resale of diesel, following unusual demand spikes at several retail fuel outlets across the country.
The Ministry of Petroleum and Natural Gas has issued the Motor Spirit and High-Speed Diesel (Temporary Regulation of Supply through Retail Outlets) Order, 2026, aimed at ensuring uninterrupted diesel availability for genuine retail consumers. The order will initially remain valid for up to 90 days.
Under the new rules, retail outlets will dispense diesel only into vehicle tanks or PESO-approved containers, with a maximum limit of 200 litres per day per customer or vehicle. Diesel bought from retail outlets cannot be resold. In simple terms, your family car is safe, your tractor is safe, but turning a fuel pump into a wholesale diesel shopping mall is not.
The Government has clarified that the measure is not fuel rationing and there is no shortage of petrol or diesel in India. The 200-litre daily cap is far above what an average private vehicle would normally require, unless someone is secretly driving a truck to the moon.
According to the Ministry, the present issue has emerged due to extraordinary and uneven growth in diesel demand at some PSU Oil Marketing Company retail outlets. A key reason has been the shift of bulk diesel consumers, including industrial, institutional and commercial buyers, from dedicated consumer pumps to regular retail outlets due to the large price gap between bulk and retail diesel.
Retail diesel is currently around ₹40 per litre cheaper than bulk diesel, creating an opportunity for some large users to exploit the difference. The Government said instances of diesel being purchased in large quantities in jerry cans and resold illegally have come to its notice.
The Ministry said private oil marketing companies recorded a decline of around 58% in High-Speed Diesel sales during May 2026, largely due to higher prices fixed by them. At the same time, diesel sales through PSU OMC retail outlets surged significantly. In May 2026, compared with the same period last year, 327 districts recorded over 10% growth, while 80 districts saw growth exceeding 30%.
The Government said such diversion of High-Speed Diesel by bulk consumers has created localized supply pressures and could inconvenience genuine retail customers as well as essential services. By prohibiting bulk consumers from sourcing fuel through retail outlets, the order seeks to ensure that more supply remains available for everyday consumers.
The Central Government has directed public sector oil marketing companies — Indian Oil Corporation Limited, Bharat Petroleum Corporation Limited and Hindustan Petroleum Corporation Limited — to ensure strict compliance with the new restrictions.
Industrial, direct, institutional and commercial customers have been instructed to procure fuel only through their designated consumer pumps and not from retail outlets. Oil marketing companies and retail outlet dealers will be responsible for preventing misuse and attempts to bypass the order.
State governments and Union Territory administrations have also been asked to take action against black marketing, unauthorized diversion and other malpractices. Violations will attract penalties and legal action under the Essential Commodities Act, 1955 and other applicable laws.
The Government said PSU Oil Marketing Companies are currently absorbing losses of around ₹500 crore per day on the sale of petrol, diesel and domestic LPG to protect retail consumers during the ongoing West Asia disruption. This support, the Ministry said, is meant for households, farmers and genuine end-users, not for bulk or industrial consumers seeking price arbitrage.
Reiterating its position, the Government said India remains the world’s fourth-largest refiner and fifth-largest exporter of refined petroleum products, and there is no question of fuel scarcity in the country.
The order, the Ministry said, is a temporary and targeted step to protect consumer interest, prevent misuse and maintain energy security. In other words, fuel pumps will continue to serve the public — just not the diesel hoarders arriving with an army of jerry cans.
