LPG Distributors in Tamil Nadu Demand Refund Following Price Reduction

Cooking gas distributors in Tamil Nadu have called on oil marketing companies to reimburse them for losses incurred due to a sudden price cut announced by the Union Cabinet. Many distributors had pre-purchased at least one load of cylinders and now face a loss of ₹200 per cylinder with no mention of a refund. This loss amounts to approximately ₹70,000 per load, and some distributors had booked up to four loads, resulting in overnight losses of ₹2.49 lakh.

The overall loss to the 27,000 distributors nationwide is estimated at ₹550 crore. Distributors argue that if the Ministry absorbs the losses incurred by oil marketing companies due to the reduction, these companies should, in turn, pass on the amount to distributors, who are willing to collect it from customers and return it to the oil companies.

According to the Price Protection Act, distributors only need to keep one day’s stock, but oil companies pressure them to take more than necessary, increasing distributor losses during price fluctuations.