With the Finance Ministry stating that it lacked money to provide for fuel subsidy, another hike in the price of petrol, diesel, domestic cooking gas and kerosene seems imminent. The hike could be introduced following the ending of the current monsoon session of Parliament on Friday.
A report by 3 oil firms have stated a combined revenue loss of Rs 47,811 crore on fuel sales in the first quarter. Even though ONGC supplemented this with Rs 15,061 crore, the Ministry of Finance has not yet released the Rs 32,750 crore sought by the Ministry of Oil.
“This is imminent. There is no question of holding back now,”said a senior official from the Ministry of Petroleum and Oil. ”Finance Ministry says it is not left with funds to subsidise oil companies. Oil companies are jewels of India. They need to be saved at all cost. Governments come and go, but oil companies will be required to fuel the country,” the official said.
The price hike in diesel, domestic LPG and PDS kerosene comes after the previous one in June 2011. It is said that state-owned fuel retailers are running at a loss of Rs 560 crore per day, regarding the sale of diesel and cooking fuel. Retailers have stated that they now do short-term borrowings for meeting funds necessary for importing crude oil (raw material). This, they say, has shot up to Rs 1,57,617 crore from Rs 1,28,272 crore towards the end of June.
A loss of Rs 5 per litre on petrol and a loss of Rs 19.26 a litre on diesel is being incurred.
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