State-owned fuel retailers — Indian Oil Corporation, Bharat Petroleum and Hindustan Petroleum — are likely to end the fiscal with a loss of Rs. 47,960 crore on selling petrol, diesel, domestic LPG and kerosene below cost.
“The three firms lose Rs. 250 crore every day on selling the four products below imported cost,” an official said.
Losses on fuel sales have widened as global oil prices have firmed up in March. IOC, BPCL and HPCL at present sell petrol at a loss of Rs. 6 a litre, Rs. 4.06 a litre on diesel, Rs. 16.91 a litre on PDS kerosene and Rs. 267.39 per LPG cylinder (14.2-kg).
The revenue loss for 2009-10 has widened to Rs. 47,960 crore from the earlier projection of Rs. 45,000 crore.
While the losses on petrol and diesel are met by upstream firms such as ONGC, the government had not kept its promise to make up all of the revenues lost on selling LPG and kerosene, he said.
Of the Rs. 29,353-crore loss in the April-December period, upstream firms contributed Rs. 8,364 crore to cover the entire shortfall on petrol and diesel. But of the Rs. 20,989-crore loss on LPG and kerosene in the first nine months, the finance ministry has provided only Rs. 12,000 crore. Besides the Rs. 8,989 crore uncovered amount of April-December, about Rs. 12,000 crore of revenue loss on LPG and kerosene in January-March quarter also remains uncovered.
The official said IOC, BPCL and HPCL would get only Rs. 12,000 crore to make up for part of the losses on LPG and kerosene. IOC would get Rs. 7,100.18 crore, BPCL Rs. 2,370.77 crore and HPCL Rs. 2,529.05 crore.
The compensation is, however, less than Rs. 20,989 crore sought by the retailers to make up for the losses they incurred on selling domestic LPG and kerosene below cost during April-December.