- Why in news
- On 12 June 2026, the Ministry of Petroleum and Natural Gas notified a temporary control order to curb black marketing and hoarding of diesel at retail outlets. It is valid initially for up to 90 days.
- What it is
- The order is a temporary supply-control measure issued under the Essential Commodities Act, 1955. It regulates how retail outlets of public sector oil companies sell diesel, so that bulk buyers do not exploit the gap between bulk and retail prices. Control orders of this kind let the Centre direct supply, fix limits and penalise hoarding.
- Duration
- The order is temporary and initially valid for up to 90 days.
- Daily cap
- Retail outlets may dispense diesel only into vehicle tanks or PESO-approved containers, up to 200 litres per day per customer or vehicle. Resale is barred.
- Bulk buyers
- Industrial and institutional or commercial customers must buy through their own consumer pumps, not retail outlets.
- Legal basis and penalty
- Violations attract penalties and legal action under the Essential Commodities Act, 1955.
- Who implements
- Directions went to IOCL, BPCL and HPCL. OMCs and dealers must ensure compliance, and States and UTs must act against malpractice.
- Price gap
- Retail diesel is about ₹40 per litre cheaper than bulk diesel, because PSU OMCs absorb losses during the West Asia disruption.
Don’t confuse with Control order vs rationing: The government says this order is not rationing and that there is no shortage. It only limits diversion to bulk buyers and caps per-day purchases.
Don’t confuse with Retail outlet vs consumer pump: Retail outlets serve the general public. Consumer pumps are dedicated installations for bulk industrial or institutional users, who must now buy from them.
Laws, judgments and statutory bodies: 30 Prelims questions since 2013 (what the law says, who chairs, legal basis). In Mains, 44 news-triggered questions, most in GS2, asking for provisions and challenges.
Why it matters
- Keeps diesel available to ordinary retail users, farmers and essential services during a global supply disruption.
- Checks arbitrage-driven diversion, which strains PSU OMC finances and local supply.
Problems
- Enforcement across many outlets depends on dealers and State machinery, and jerry-can resale is hard to detect.
- Two-tier pricing of retail and bulk diesel creates a lasting incentive for diversion, and OMC losses continue.
Way forward
- Monitor outlet-level sales data to detect abnormal offtake and act early.
- Review the price gap and consider targeted support so that control orders stay temporary.
Put in your answer
Scale of OMC under-recovery: PSU OMCs are absorbing about ₹500 crore per day in losses on petrol, diesel and domestic LPG.
Surge in demand: In May 2026, 327 districts saw over 10% growth in diesel sales at PSU retail outlets, and 80 saw over 30%.
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UPSC’s own questions that come close to this issue, from our Prelims and Mains banks.
No practice question for this one; the card may still help an answer. Why: A temporary 90-day supply control order against hoarding. Useful for current affairs, but a short-lived order is unlikely to be set. Laws and rules are 7% of Prelims news questions.
Worth revising until Prelims 2028: most news questions come within two years of the event.