The Crossbill News Desk
Amid mounting financial stress on state-owned fuel retailers and continued volatility in global energy markets, the Union government has indicated that it does not currently intend to compensate public sector oil marketing companies for losses arising from controlled retail fuel prices.
The clarification comes even as speculation grows over a possible upward revision in petrol, diesel and domestic LPG prices following the conclusion of recent Assembly elections.
The government has no plan at present to compensate public sector oil marketing companies (OMCs) for their losses on sale of petrol, diesel, and jet fuel below market prices, a senior Petroleum Ministry official said on Monday, The Indian Express reported.
The comments come at a time when there is growing speculation over the possibility of an increase in fuel prices, particularly petrol and diesel.
Despite the surge in international oil and fuel prices amid the West Asia crisis, retail prices of regular petrol and diesel haven’t been hiked. In the case of ATF, or jet fuel, just about 25% of the price increase was passed on for domestic flights on April 1, although a full passthrough was done for international flights.
Consequently, public sector OMCs—Indian Oil Corporation, Bharat Petroleum Corporation, and Hindustan Petroleum Corporation—are incurring heavy losses on the sale of these fuels, and have been pushing for price hikes.
Petrol and diesel prices have not been hiked for over four years now in India. Moreover, the timing of the current global surge in prices, which clashed with assembly elections in some states, made it politically fraught for the prices to be hiked.
In the absence of price increases, the OMCs are facing significant financial burden. But the government has no proposal to extend any financial support to the companies.
The OMCs are also incurring heavy under-recoveries on sale of liquefied petroleum gas (LPG) to households, even as they have hiked prices of commercial and industrial LPG in line with international prices movements.
The clarification comes even as speculation grows over a possible upward revision in petrol, diesel and domestic LPG prices following the conclusion of recent Assembly elections.
The government has no plan at present to compensate public sector oil marketing companies (OMCs) for their losses on sale of petrol, diesel, and jet fuel below market prices, a senior Petroleum Ministry official said on Monday, The Indian Express reported.
The comments come at a time when there is growing speculation over the possibility of an increase in fuel prices, particularly petrol and diesel.
Despite the surge in international oil and fuel prices amid the West Asia crisis, retail prices of regular petrol and diesel haven’t been hiked. In the case of ATF, or jet fuel, just about 25% of the price increase was passed on for domestic flights on April 1, although a full passthrough was done for international flights.
Consequently, public sector OMCs—Indian Oil Corporation, Bharat Petroleum Corporation, and Hindustan Petroleum Corporation—are incurring heavy losses on the sale of these fuels, and have been pushing for price hikes.
Petrol and diesel prices have not been hiked for over four years now in India. Moreover, the timing of the current global surge in prices, which clashed with assembly elections in some states, made it politically fraught for the prices to be hiked.
In the absence of price increases, the OMCs are facing significant financial burden. But the government has no proposal to extend any financial support to the companies.
The OMCs are also incurring heavy under-recoveries on sale of liquefied petroleum gas (LPG) to households, even as they have hiked prices of commercial and industrial LPG in line with international prices movements.
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