IOC losing Rs79 crore a day due to pricing curbs: official
16 Sep 2009
State-run Indian Oil Corporation, the nation's largest fuel retailer, is reportedly losing about Rs79 crore per day on selling auto and cooking fuel below cost. However, "international oil prices have softened a bit, resulting in a marginal reduction in our under-recoveries on petrol, diesel, domestic LPG and kerosene", PTI quoted an IOC official as saying.
IOC and its sister public sector undertakings HPCL and BPCL, which have been barred by the government from revising fuel prices, calculate the desired selling price for petrol and diesel on the first and sixteenth of every month based on the previous fortnight's average global oil price.
The three firms currently lose Rs3.63 per litre on petrol and Rs2.33 a litre on diesel. These are lower than Rs4.69 per litre loss on petrol and Rs3.09 a litre on diesel they suffered in the first fortnight of September.
"IOC lost Rs90 crore per day on fuel sales in the first fortnight of September. This has come down to Rs79 crore a day from today," the official told PTI today in New Delhi.
On domestic LPG and kerosene, the desired price of which is calculated by the government on a monthly basis, the three firms make a loss of Rs158.55 on each 14.2 kg LPG cylinder, and Rs17.15 on every litre of kerosene sold.
"At current oil prices, IOC will end the fiscal with a revenue loss of Rs23,510 crore and the industry (IOC plus BPCL and HPCL) will see a revenue loss of Rs41,440 crore," the official said.
The basket of crude oil India buys from overseas markets averaged $68.07 per barrel in September as against the August average of $71.98 a barrel.
Petroleum Secretary R S Pandey had last week stated that the government will compensate under-recovery or revenue loss on sale of domestic LPG and kerosene through yet another issue of oil bonds.