Indian Oil Corp Losing Substantial Amounts on Fuel Sales
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Friday, 18 July 2008 |
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Recent increase in petrol retail prices are still not enough to stop Indian Oil Corp losing money on petrol retail sales.
The steepest hike in petrol, diesel and domestic LPG prices
notwithstanding, Indian Oil Corp (IOC) is losing us$96m (Rs 413 crore)
per day on fuel sales. "Last month's hike and cut in
customs and excise duties were not sufficient to cover the gap between
domestic retail price and cost of imported raw material (crude oil)," a
senior company executive said.
IOC and sister state-run firms Hindustan Petroleum and Bharat Petroleum
are currently selling petrol at a loss of .39cents (Rs 16.70) per
litre, and diesel at .64cents ( Rs 27.61) a
litre.
"Our daily loss based on the average price of first fortnight of July
was Rs 413 crore (us$96m). For the industry the figures would be close
to Rs 800 crore($186m)" he said.
But with firming up of crude oil prices, the gains from price hike and
duty cuts have almost been washed away. Government is
reported to provide oil bonds valued Rs 94,000 crore to the three state
firms to partly compensate them for selling fuel at below cost. However
the deficit remains.
PetrolWorld 160708
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