New Delhi: The petroleum ministry has sought oil bonds worth Rs11,853 crore for state-run fuel retailers to make up for the losses they incurred on selling domestic LPG and kerosene below cost during the first half of the current fiscal.
Helping hand: IOC headquarters in New Delhi. The government has to issue oil bonds worth Rs7,136 crore to the oil retailer. Ramesh Pathania / Mint
Three fuel retailers—Indian Oil Corp. Ltd (IOC), Bharat Petroleum Corp. Ltd (BPCL) and Hindustan Petroleum Corp. Ltd (HPCL)—lost Rs15,856 crore in revenue on selling petrol, diesel, domestic LPG and kerosene below cost during the first half of the current fiscal, a ministry official said.
Of this, Rs11,853 crore is revenue lost on LPG and kerosene, the remaining Rs4,003 crore was on account of petrol and diesel.
While the government had committed to meeting the revenue loss arising from its decision of not increasing prices of domestic LPG and kerosene and selling these below cost, the non-issuance of oil bonds till now has resulted in HPCL and BPCL reporting losses in the July-September quarter. However, IOC fared better, registering a net profit of Rs284.36 crore.
HPCL reported a net loss of Rs136.68 crore, while BPCL posted a net loss of Rs158.77 crore.
The government has to issue oil bonds worth Rs7,136 crore to IOC, Rs2,443 crore to HPCL and Rs2,274 crore to BPCL.
The official said the government had earlier this year decided to make good all of the revenue loss on sale of domestic LPG and kerosene through issue of oil bonds, while the same on petrol and diesel would be mostly met by upstream firms such as Oil and Natural Gas Corp. Ltd.