The central government will not compensate the oil companies for their losses on petrol and diesel. Despite the rise in crude oil prices, prices for the common people have been kept stable. Companies are incurring a loss of Rs 25-28 per litre.
New Delhi: The Central Government has made it clear that no financial assistance will be given to oil companies to compensate for the losses incurred on the sale of petrol, diesel and aviation fuel (ATF). This decision has come at a time when oil companies are already facing huge losses.
Government oil companies – Indian Oil Corporation (IOC), Bharat Petroleum Corporation Limited (BPCL) and Hindustan Petroleum Corporation Limited (HPCL) have been facing severe financial difficulties for some time. The main reason for this is that due to tension in the Gulf countries, the prices of crude oil have skyrocketed in the last two months, but the prices of petrol and diesel in the country have not been increased for the last four years. Now companies have started incurring losses even on the sale of ATF.
Sujata Sharma, Joint Secretary, Ministry of Petroleum and Natural Gas, said, “The government has no proposal to compensate the losses of oil companies.” According to reports, oil companies are incurring a loss of Rs 25 to 28 per liter on petrol and diesel, yet the prices were not increased.
Last month, ATF prices for domestic airlines were increased by 25%, but companies say this is not enough to cover the losses. At the same time, there was an increase of more than 5% on the fuel given to foreign airlines. On March 7, the price of domestic LPG cylinder (14.2 kg) was increased by Rs 60, but companies are calling this also inadequate. Earlier the government used to compensate the loss on LPG through subsidy, but now there is no such new scheme.
Sujata Sharma said that despite the disruption in supply due to the war in the Middle East, the government decided not to increase the prices of petrol, diesel and domestic LPG to protect the common people. The price changes were restricted to bulk diesel and commercial LPG, which are mostly used by industrial and commercial customers.
International ATF prices increased by $76.55 per kiloliter (5.33%) from May 1, bringing the new price to $1,511.86 per kiloliter. The price of 19 kg commercial LPG cylinder used in hotels and restaurants increased by Rs 993 to Rs 3,071.50. At the same time, the price of 5 kg LPG cylinder increased from Rs 549 to Rs 810.50.
For industrial customers of bulk diesel like telecom tower operators, the price has now become Rs 149 per litre. Whereas the price of diesel for the common people at petrol pumps remains stable at Rs 87.62 per liter. However, the price of ATF for domestic airlines remains unchanged at Rs 1,04,927.18 per kilolitre.