IOC losing Rs 3/lt of petrol, but no hike in price

State-owned Indian Oil Corp (IOC) on Tuesday said it is losing about Rs 3 on the sale of every litre of petrol, but will decide on raising prices at an "appropriate" time.

The government had in June last year decontrolled petrol pricing, giving state oil firms the freedom to revise rates in sync with crude oil prices.

IOC and its sister PSUs, HPCL and BPCL, had last raised rates by about Rs 2.50 a litre in January and have not raised prices since then, despite crude oil prices touching USD 110 a barrel.

"We are losing about Rs 3 per litre on petrol," IOC Director (Finance) S V Narasimhan told reporters here.

Asked if the government has asked oil companies not to raise petrol prices, he said: "I can't say anything on that... We will revise petrol price at appropriate time." He did not elaborate.

In Parliament, Oil Minister S Jaipal Reddy said: "As and when the decision is taken, you will be told about that. I have nothing to say at this moment."

Reddy had last week stated that "it was advisable for everybody" to wait for a meeting of Empowered Group of Ministers (EGoM) on fuel prices to meet and discuss the issue.

Immediately after that, Oil Secretary S Sundareshan issued a statement to say that "there is no change in the policy of the government regarding pricing of petrol being market-determined."

"Oil marketing companies continue to have the freedom to determine the price of petrol," he had said on February 25. While petrol prices have been freed, the EGoM headed by Finance Minister Pranab Mukherjee is to decide on rates of diesel, domestic LPG and kerosene.

"If EGoM on diesel happens, that will happen with your knowledge. You will be informed," Reddy told reporters today. Narasimhan said IOC was losing Rs 217 crore (Rs 2.17 billion) per day on selling diesel, domestic LPG and kerosene below cost.

IOC loses Rs 12.56 per litre of diesel, Rs 24.74 per litre of kerosene and 297.80 per domestic LPG cylinder.

The company is projected to end the fiscal with a cumulative revenue loss of Rs 42,876 crore (Rs 428.76 billion) due to subsidised sales of diesel, domestic LPG and kerosene.

"We hope EGoM will take a decision soon (on diesel prices)," he said. Together, the three state-run fuel retailers are projected to end the fiscal with a revenue loss of Rs 77,645 crore (Rs 776.45 billion).