New Delhi: Indian Oil Corporation (IOC) confirmed that it is losing Rs122 crore per day on fuel sales and will have to borrow Rs 3,000 crore a month to meet expenses if prices are not immediately increased.
“Our borrowings will go up at the rate of Rs3,000 crore a month if retail prices of petrol, diesel, LPG and kerosene are not raised or a compensation package given to us,” IOC Chairman Sarthak Behuria told reporters.
IOC and other state-run oil marketing companies such as BPCL and HPCL are suffering revenue losses on sale of fuel as the government has not allowed them to raise prices in line with the increase in international crude oil prices that are racing toward $100 a barrel. India imports nearly three-fourth of its crude oil requirements.
Behuria said IOC is losing Rs6.34 on sale of every litre of petrol, Rs7.88 on diesel, Rs 212 per LPG cylinder and Rs 17 on a litre of kerosene.
“These losses are based on the October crude oil price average when the Indian basket was at $79.33 per barrel. Now Indian basket is at $89.36 a barrel that will widen the losses,” he said.
Behuria said the company’s investment plans would be impacted if the government did not act immediately to help it.
IOC’s current borrowings stand at Rs 2,8000 crore. “This will increase at the rate of Rs3,000 crore a month from November if nothing is done immediately,” he said.