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Indian Oil losing $15 mn a day on fuel sale

business Updated: Aug 26, 2009 17:39 IST

State-run petroleum products retailer Indian Oil Corp on Wednesday said it was losing nearly $15 million every day by selling transport and cooking fuels below cost.

"At the current global prices, Indian Oil is suffering a daily loss of Rs 74 crore ($15 million)," IOC chairman Sarthak Behura told reporters in New Delhi on the margins of a global hydrogen technologies convention.

He said the losses on account of under-recoveries, or the difference between the cost and sale price of petroleum fuels , will amount to Rs 2,300 crore by the end of this fiscal.

Behura said the company was losing Rs 2.33 per litre on diesel, Rs 4.60 per litre on petrol, Rs 158 per cylinder on cooking gas and Rs 15.46 per litre on kerosene.

Last month, the government had permitted state-run oil retailers to hike petrol prices by Rs 4 per litre and diesel by Rs 2 per litre, which was widely criticised by opposition parties and customers.

The prices of kerosene and cooking gas were left untouched.

Since then, global crude prices have shot up further and are ruling at a 10-month high of nearly $75 per barrel, putting pressure on transport fuel retailers in the country.

But Petroleum Secretary R S Pandey told the convention, hosted by IOC and the Society of Indian Automobile Manufacturers (SIAM), that there was no proposal to increase fuel prices.

"We are not comfortable with the current global prices. But there is no proposal to increase fuel prices," he said.