"At present prices, the company is incurring a daily loss of Rs 160 crore (Rs 1.6 billion). IOC is facing under-recovery to the extent of Rs 10.50 per litre in petrol and diesel," Sarthak Behuria, chairman, IOC said.
He said these prices were not sustainable, adding that the government should revise the prices upwards. In addition to this, Behuria also urged the government to lighten the subsidy burden on account of LPG and kerosene by way of loss sharing formula along with other oil companies.
In LPG, under-recovery was Rs 130 per cylinder, while that for kerosene was Rs 14 per litre. He said IOC's Rs 7500 crore (Rs 75 billion) capital expenditure plans during 2006-07 would be affected if prices were not revised.
"So far, all our projects are going as per schedule," he said. He said the oil major would be able to maintain its profitability during 2005-06. The falling marketing margins would be offset by refining margins.
Besides, IOC would also get a cash flow following sale of Rs 6300 crore (Rs 63 billion) bonds offered to it by the government.
Behuria said IOC would get substantial money from dividends from other oil companies and partial sales of shares in GAIL and ONGC.