Loyalty Programme - A Game Changer in the Volatile Market Environment of Indian Oil Industry

Abstract

The oil and gas sector is among the six core industries in India and plays a key role in influencing decision making for all the other important sections of the economy. The Government of India has adopted several policies to fulfill the increasing demand. The government has allowed JOO per cent Foreign Direct Investment (FD/) in many segments of the sector, including natural gas, petroleum products, and refineries, among others. Before liberaliuition, the sector is completely dominated by state-owned enterprises (SOEs)Bharat Petroleum Corporation limited (BPCL), Hindustan Petroleum Corporation limited (HPCL) and Indian Oil Corporation limited (IOCL). The three · SOEs enjoyed a monopoly under the administered pricing mechanism of the government. With full deregulation of the industry in 2002, the market structure are completely changed and the entry of local (private) and global players make the highly competitive. Indian Oil is India's flagship national oil company with business interests straddling the entire hydrocarbon value chain - refining, pipeline transportation and marketing of petroleum products, exploration & production of crude oil & gas, marketing of natural gas and petrochemicals.