State-owned oil marketing companies IOC, BPCL, and HPCL posted a second consecutive quarterly loss for the first time ever on holding petrol and diesel prices below the cost of production, PTI reported.
IOC, BPCL, and HPCL posted a second consecutive quarterly loss totaling ₹2,748.66 crore in July-September quarter. The losses for OMCs would have been higher but for the ₹22,000 crore, a one-time government grant paid to make up for losses incurred on selling cooking gas LPG at rates below cost in the last two years, the report said.
During July-September, IOC accounted for ₹10,800 crore of LPG subsidy received from the government after the quarter had ended, while HPCL booked ₹5,617 crore. BPCL got a ₹5,582 crore one-time grant.
Indian Oil Corporation (IOC), Bharat Petroleum Corporation Ltd. (BPCL), and Hindustan Petroleum Corporation Ltd. (HPCL), which are supposed to revise petrol and diesel prices daily in line with cost, have not changed rates for a record seven months in a row, the report added.
IOC reported a net loss of ₹272.35 crore for the July-September quarter, which came on the back of a ₹1,995.3 crore loss in Q1FY23. HPCL reported a loss of ₹2,172.14 crore in the second quarter of the current fiscal, on the back of its highest-ever quarterly loss of ₹10,196.94 crore in April-June.
BPCL posted a loss of ₹304.17 crore in July-September, following a loss of ₹6,263.05 crore in the first quarter of the current fiscal year.
The combined loss for the first half of the current fiscal year that began on April 1 now stands at ₹21,201.18 crore, the highest ever for any six-month period, including the era when petrol and diesel prices were regulated and the government used to give subsidies to the three retailers.
Meanwhile, domestic retail rates were put on hold at levels that are lower than the current international oil price of USD 97.75 per barrel. The under-recovery, which is the difference between the retail selling price and the international rate, is currently about ₹27 per litre on diesel, but the actual cash loss (the loss based on the actual cost of procurement of crude oil and turning it into fuel) is about ₹3–4 per litre.
Petrol and diesel prices are supposed to be revised daily, but state-owned fuel retailers have not exercised their rights since April 6. Rates have been on freeze since then, except on May 22, when prices were reduced following a cut in excise duty. Prior to the April freeze, petrol and diesel prices had gone up by ₹10 per litre each, according to PTI.
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