Loss on diesel sales rises to Rs 8.37 a litre

The loss on diesel sales has inched up marginally to Rs 8.37 a litre even as a surge in international oil rates and a weakening rupee wiped out gains from a 50 paise increase in the price of the fuel.

Public sector oil firms Indian Oil Corp, Bharat Petroleum Corp Ltd and Hindustan Petroleum Corp Ltd will lose Rs 8.37 on every litre of diesel sold in the first fortnight of March, up from Rs 8.31 a litre in the second half of February, an official statement said.

The price of diesel had been increased by 50 paise a litre, excluding local sales tax or VAT, from March 1. This follows international prices firming up by about $2 per barrel and the rupee dipping from Rs 62.02 against the dollar to Rs 62.12.

Besides diesel, oil firms are also losing Rs 36.34 per litre on kerosene sold through the public distribution system, up from Rs 35.76 a litre last month. On cooking gas (LPG), the revenue loss or under-recoveries have come down to Rs 605.80 per 14.2-kg cylinder from Rs 655.96 in February.

Oil marketing companies are now incurring a combined daily under-recovery of about Rs 411 crore on the sale of diesel, PDS kerosene and domestic LPG compared with Rs 456 crore (Rs 4.56 billion) daily during the previous fortnight, the statement said.

The three firms had together lost Rs 1,00,632 crore (Rs 1 trillion) on the sale of the three products in April-December and may end the financial year with a total under-recovery of about Rs 1,40,000 crore (Rs 1.4 trillion). This compares with an under-recovery of Rs 1,61,029 crore (Rs 1.61 trillion) in 2012-13 and Rs 1,38,541 crore (Rs 1.38 trillion) in the previous fiscal.

The statement said during the current financial year, oil firms lost Rs 47,655 crore (Rs 476.55 billion) on sale of diesel at rates lower than cost and another Rs 30,604 crore (Rs 306.04 billion) on domestic LPG. They incurred an under-recovery of Rs 22,373 crore (Rs 223.73 billion) on the sale of kerosene, it added.