Indian oil corporation losing 413 Crore per day

The steepest hike in petrol, diesel and domestic LPG prices notwithstanding, Indian Oil Corp (IOC) is losing Rs 413 crore per day on fuel sales.“Last month’s hike and cut in customs and excise duties were not sufficient to cover the gap between domestic retail price and cost of imported raw material (crude oil),” a senior company executive said.IOC and sister state-run firms Hindustan Petroleum and Bharat Petroleum are currently selling petrol at a loss of Rs 16.70 per litre, diesel at Rs 27.61 a litre, kerosene at Rs 38.09 per litre and domestic LPG at a discount of Rs 338.53 per 14.2-kg cylinder.“Our daily loss based on the average price of first fortnight of July was Rs 413 crore. For the industry the figures would be close to Rs 800 crore,” he said.IOC, he said, was losing Rs 34 crore per day on sale of petrol, Rs 270 crore on diesel, Rs 76 crore on kerosene and Rs 33 crore per day on LPG.“For the full 2008-09 fiscal, we anticipate our total under-realisation (of revenue) at around Rs 121,015 crore. This when clubbed with losses of HPCL and BPCL, the under- realisation would be Rs 222,785 crore,” he said.Before the June 4 hike in petrol price by Rs 5 a litre, diesel by Rs 3 per litre and domestic LPG by Rs 50 per cylinder, the total revenue loss of the three companies was put at a staggering Rs 246,000 crore.But with firming up of crude oil prices, the gains from price hike and duty cuts have almost been washed away.Government is slated to provide oil bonds worth Rs 94,000 crore to the three firms to partly compensate them for selling fuel at below cost while upstream firms like ONGC and OIL will chip in another Rs 48,000 crore.Ways have to be found to meet the remaining deficit.