The government on Monday hinted that petrol and diesel prices are unlikely to be hiked in haste, even though global crude oil prices continue to rule at the uncomfortable level of USD 110 a barrel.
State-run Indian Oil Corp, Hindustan Petroleum and Bharat Petroleum currently sell petrol, a commodity which the government freed from its control in June 2010, at a discount of about Rs 4.50 a litre to its imported cost.
Diesel, whose price is still controlled by the government, is sold at a loss of Rs 15.79 a litre or Rs 283 crore per day.
"I think oil companies must be watching global markets, which is today characterised by unusual volatility. They will in good time take a view," oil minister S Jaipal Reddy told reporters in New Delhi.
He was asked why the deregulated price of petrol has not moved in tandem with the international cost.
"As far as petrol is concerned, there is no doubt it is decontrolled... Oil companies must be watching global markets and will take studied decision (on raising prices)," he said.
On diesel, he said "it is too early" to call a meeting of the Empowered Group of Ministers (EGoM) headed by finance minister Pranab Mukherjee to decide on raising rates.
"Everybody is busy (with electioneering)... let us wait for some time," he said.
The basket of crude oil that India buys has averaged USD 110.61 per barrel this month as against USD 72-73 a barrel at the time of the last revision in diesel prices in June, 2010.
In all probability, petrol and diesel prices may not be hiked till Assembly elections in Assam, Kerala, Puducherry, Tamil Nadu and West Bengal are completed in May.
"Since June, the oil companies have chewed up about Rs 2,000 crore losses on selling petrol below cost. Rs 400 crore is what these companies will lose in March alone," an industry official said.
The three firms had last hiked petrol price by Rs 2.50 on January 15. Since deregulation of rates in June, the rates have gone up about Rs 7 per litre in five installments to Rs 58.37 per litre.
Besides petrol, the three retailers are losing a record Rs 15.79 a litre on diesel, Rs 24.74 per litre on kerosene and Rs 297.80 per 14.2-kg LPG cylinder.
The three firms are losing a cumulative Rs 432 crore in revenue every day on selling diesel, domestic LPG and kerosene below cost, the official said.
"For the full fiscal, the three are projected to lose Rs 78,061 crore in revenues at current prices," he said.