Oil companies' losses down to Rs 600 cr per day following fuel price hikes

India's state-owned oil firms have trimmed their daily losses from selling fuel below cost to around Rs 600 crore per day after four rounds of petrol and diesel price hikes.

The four rounds of petrol and diesel price hike, totalling about Rs 7.5 per litre, have trimmed the losses state-owned oil firms were incurring from selling fuel below cost to close to Rs 600 crore per day, Sujata Sharma, Joint Secretary in the Ministry of Petroleum and Natural Gas, said on Monday.

The losses on sale of petrol, diesel and domestic cooking gas LPG were about Rs 1,000 crore per day before the start of the May 15 cycle of price revision.

''It (losses) is slightly less than Rs 600 crore per day,'' she said.

These losses include those from the sale of domestic LPG as well. LPG sold to domestic households is a subsidised product, and the difference between the cost and retail selling price is made good by the government.

Petrol and diesel, on the other hand, are deregulated products whose pricing is market-determined. The losses on these products accumulated after state-owned oil companies kept retail rates frozen despite the war in Iran pushing up input crude oil prices by over 50 per cent.