Number of fuel retail outlets in T.N. on the rise, even as existing ones in urban and peri-urban areas close down

As oil marketing companies (OMCs) and private names compete to fuel the State’s economy, more retail outlets (ROs) are being opened along highways, in urban and in rural markets. As on date, there are over 8,160 outlets providing facilities such as liquefied petroleum gas (LPG), compressed natural gas (CNG), and e-vehicle charging points.

Public sector undertakings (PSUs) alone have 7,100 bunks, of which 1,990 are in urban centres, 1,409 in rural areas, and 3,859 along highways, according to data provided by official sources in the oil industry. Private companies have a total of 903 outlets. During the period April 2024-October 2025 alone, 611 new outlets have been commissioned by both PSUs and the private sector. “As new highways are formed, more outlets are coming up along these roads that connect to growing towns and new industrial areas,” said an oil industry source.

Among the PSUs, the latest entrant is Mangalore Refinery and Petrochemicals Limited, which has six outlets in Tamil Nadu and has called for more applicants interested in opening ROs. “Work is under way to open more ROs,” said a company source. Chennai Petroleum Corporation Ltd., an Indian Oil Group company, which has its refinery in Manali, is also foraying into the RO business. It had invited applications from interested parties a couple of months ago.

However, even as new ROs are being commissioned, existing petrol bunks are closing down especially in urban and peri-urban areas. Industry experts attribute this to the real estate boom. “It is a better proposition to sell off land than run an outlet. Bunks are turning into parking spaces, restaurants, and even houses in cities that are starved of retail spaces,” said an expert. An RO owner said the business was no longer lucrative, especially since running costs were rising while their commissions remained static.

Consumer activist T. Sadagopan said that in the last 50- 60 years, bunks and gas agencies were opened due to the largesse of MPs and Ministers from Tamil Nadu. “Land costs were affordable several decades ago. Now, land costs have spiralled, making bunks unattractive when compared to real estate. I hear that commissions provided to bunk owners too are not much. With shortage in labour and high maintenance costs, bunks are struggling. In the interest of vehicle owners, the government must come up with a policy by which it can lease out its lands. It can also provide tax incentives to land owners leasing lands for ROs,” he added.