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Oil Firms Lose Rs 24/Litre on Petrol, Rs 104 on Diesel as Crude Soars

Oil marketing companies are facing significant under-recoveries of Rs 24 per litre on petrol and Rs 104 on diesel as global crude prices surge above USD 100 per barrel. The government has reduced excise duties to keep retail pump prices stable, with OMCs absorbing the remaining cost difference. Officials have assured that fuel supply remains stable, with secured crude inventories for the next sixty days and refineries operating at maximum capacity. The government is also promoting PNG infrastructure expansion to reduce dependence on LPG.

Key Points: Oil Firms Lose Rs 24/L on Petrol, Govt Holds Prices Steady

  • OMCs incurring huge losses
  • Govt cut excise duty to stabilize prices
  • Crude surged from $65 to over $100
  • Fuel supply assured for 60 days
  • Refineries operating at max capacity
2 min read

Oil companies making loss of Rs 24/litre on petrol, Rs 104 on diesel as crude above USD 100; Govt holds pump prices steady

Oil marketing companies face huge losses on fuel sales as crude prices surge above USD 100. Govt says supply is secure for 60 days.

"Currently, there is an under-recovery of about Rs 24 per litre on petrol and Rs 104 per litre on diesel. - Sujata Sharma"

New Delhi, April 2

Oil marketing companies in India are currently incurring significant losses on fuel sales as global crude oil prices surge amid the ongoing West Asia conflict, even as retail fuel prices remain unchanged, according to the Ministry of Petroleum and Natural Gas.

Addressing reporters at an inter-ministerial briefing on Thursday, Sujata Sharma, Joint Secretary in the Ministry, said that OMCs are facing under-recoveries of about Rs 24 per litre on petrol and Rs 104 per litre on diesel.

"The Government of India has reduced excise duty to keep prices stable, and part of the burden is also being borne by our oil marketing companies. Currently, there is an under-recovery of about Rs 24 per litre on petrol and Rs 104 per litre on diesel," she said.

Since the beginning of the conflict in West Asia, Brent crude oil prices have surged sharply from around USD 65 per barrel to now trading above USD 100 per barrel.

This sharp rise in crude prices has increased the cost of fuel production significantly. However, as retail prices in the domestic market have not been raised, oil marketing companies are absorbing the difference, leading to losses on every litre of fuel sold.

Despite the challenging global environment, the government has assured that fuel supply remains stable across the country.

"Our retail outlets are operating normally," Sharma said, adding that crude supplies have been secured for the next sixty days and inventories are sufficient.

She further noted that refineries in the country are operating at maximum capacity. Addressing concerns about sulfur supply, she clarified that there is no shortage.

"Since our refineries are operating at maximum capacity, there is no shortage of sulfur," she said.

On the natural gas front, the government assured uninterrupted supply to domestic consumers.

"The supply of natural gas to domestic consumers is 100 per cent assured," Sharma said, highlighting ongoing efforts to expand Piped Natural Gas (PNG) infrastructure across the country.

She added that promoting PNG can help reduce dependence on LPG and ease supply pressures. The government has also issued an order stating that an additional 10 per cent commercial LPG will be provided if state governments promote PNG expansion through ease of doing business measures.

- ANI

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Reader Comments

S
Shreya B
₹104 loss on diesel! That's shocking. My father is a truck driver and our entire family depends on his income. If diesel prices shoot up, freight costs will rise and everything from vegetables to medicines will become more expensive. The government holding prices is a relief for now, but for how long?
A
Aman W
Good move by the government to cut excise duty and absorb some shock. In the long run, these losses will hurt the economy. We need to reduce our dependence on imported crude. Fast-tracking ethanol blending and solar power is the way forward. Jai Hind!
P
Priyanka N
While I appreciate stable prices, I'm worried. These "under-recoveries" often mean the government will eventually have to pay the OMCs, which is taxpayer money. It feels like just postponing the problem. Transparency about the long-term plan would be helpful.
D
David E
Interesting to see India's approach. In the US, pump prices react almost instantly to crude prices. This price control provides short-term stability but distorts the market. The push for PNG expansion mentioned in the article seems like a smart diversification strategy.
K
Karthik V
The focus should be on the common man. Auto-rickshaw drivers, small farmers using pump sets, delivery personnel - their livelihoods are at stake. Hope the 60-day secured supply leads to some global price cooling. Meanwhile, carpooling, anyone? 👍

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