Oil PSUs may lose Rs38,700cr this year

Oil PSUs may lose Rs38,700cr this year
PTI
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First Published: Tue, Jun 16 2009. 04 45 PM IST
Updated: Tue, Jun 16 2009. 04 45 PM IST
New Delhi: For the first time in seven months, state-run fuel retailers are making losses on selling diesel and together with negative returns on petrol, LPG and kerosene, the companies may lose Rs38,700 crore in revenues this year.
Indian Oil, Bharat Petroleum and Hindustan Petroleum from Tuesday are selling diesel at a loss of Rs 2.96 a litre, an industry official said.
In the first half of this month, they were barely breaking even on diesel, the most consumed auto fuel in India.
The firming international crude oil prices, which are ruling at seven-month high of $71 per barrel, have widened losses on petrol to Rs6.08 per litre from Rs3.68 a litre in the first half of June.
“The three are currently losing Rs135 crore per day on sale of petrol, diesel, domestic LPG and kerosene,” he said.
The government has been mulling decontrolling petrol and diesel prices for couple of months now but may be fast losing the window as the move would now result in steep rise in fuel prices. Freeing of fuel prices was idle when crude had fallen to below $40 a barrel earlier this year.
The three firms are losing Rs69.49 per 14.2 kg LPG cylinder and Rs12.65 on every litre of kerosene, he said.
The state-run firms were till last month selling diesel at Rs0.32 a litre profit which helped them partly neutralise the losses on sale of petrol, domestic LPG and kerosene.
Since November, the three had been making profit on sale of diesel — the margin being as high as Rs6.19 a litre in first fortnight of March. On petrol, they made profits till second fortnight of March and loses thereafter.
However, the rising global crude oil prices have eroded the margins and the three firms have seen revenue loss on fuel sale widen to Rs135 crore per day from Rs72 crore per day till Monday, the official said.
For the 2009-10 fiscal, the three firms, which calculate desired retail end prices on 1st and 16th of every month based on the average of previous fortnight, are estimated to lose Rs38,700 crore on fuel sales.
The official said IOC, BPCL and HPCL are currently losing about Rs22 crore per day on sale of petrol, Rs53 crore on diesel, Rs48 crore on kerosene and Rs11 crore on LPG.
With the global economic meltdown leading to a sharp drop in international crude oil prices from September, state-run fuel retailing companies have been making neat profits on petrol and diesel.
In the second fortnight of December, the oil firms made Rs11.48 a litre profit on petrol sales.
Crude prices, which had dropped to below $40 a barrel from Rs147 per barrel in July 2008, have since risen to $68 per barrel, a seven-month high.
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First Published: Tue, Jun 16 2009. 04 45 PM IST