Oil marketers to incur loss of Rs.121,000 crore in current fiscal
October 10th, 2011 - 8:02 pm ICT by IANSMumbai, Oct 10 (IANS) A depreciating rupee and higher cost of crude was affecting the functioning of oil marketing companies (OMCs) and they could end up incurring losses of over Rs.121,000 crore during 2011-12, Petroleum Minister Jaipal Reddy said here Monday.
“Weakening by every Re.1 impacts the cost of diesel, kerosene and domestic liquefied petroleum gas by Rs.8,000 crore per annum,” Reddy said here while addressing a meeting of the consultative committee of member of parliaments attached to his ministry.
The rupee which traded at 46 a US dollar in the beginning of September, is now hovering around 49 to the dollar. The average price of the Indian basket of crude oil has also shot up to $111 a barrel.
“OMCs are forced to borrow even for their working capital requirements. If their financial health deteriorates on account of under recoveries, their ability to discharge assigned task of supplying the entire country with petroleum products would suffer,” said the minister.
“Even after these measures, the OMCs are currently suffering under-recoveries to the tune of Rs.271 crore per day. They are expected to incur an under-recovery of over Rs.121,000 crore.”
The government had in September hiked petrol prices by Rs.3.14 a litre citing huge under-recoveries and rising international prices of crude.
- Oil companies to bear Rs.121,571 crore under-recoveries: Reddy - Oct 19, 2011
- Forced to hike petrol prices, say government, oil firms - Nov 04, 2011
- May consider reduction of diesel subsidy : Reddy - Feb 15, 2012
- No government role in petrol price hike: Pranab - Nov 05, 2011
- Fresh petrol price hike of Rs.1.80 per litre - Nov 03, 2011
- Petrol prices lowered by 65 paise a litre (Lead) - Nov 30, 2011
- Would cut petrol prices if crude prices fall: IOC - May 24, 2012
- 'Oil companies will decide on petrol price hike' - Nov 02, 2011
- Fuel price hike a necessity but no decision yet: Jaipal Reddy - May 22, 2012
- Diesel price to go up if inflation comes down: Rangarajan - Oct 20, 2011
- Oil firms ask government to compensate them - Apr 17, 2012
- Petrol prices lowered by Rs.1.85 per litre - Nov 15, 2011
- Petrol price hike in the offing as crude soars - Mar 23, 2012
- Petroleum sector contributes Rs.192,577 crore to exchequers - Dec 13, 2011
- Petrol price hiked by Rs.6.28 plus taxes, industry welcomes move (Second Lead) - May 23, 2012
Tags: consultative committee, crore, crude oil, financial health, indian basket, jaipal reddy, kerosene, liquefied petroleum gas, litre, losses, marketing companies, member of parliaments, mumbai, oil marketers, omcs, petrol prices, petroleum products, rs 8, rupee, working capital