New Delhi [India], April 2 : Oil marketing companies (OMCs) in India are currently incurring significant losses on fuel sales as global crude oil prices surge amid the ongoing West Asia conflict, even as retail fuel prices remain unchanged, according to the Ministry of Petroleum and Natural Gas.
Addressing reporters at an inter-ministerial briefing on Thursday, Sujata Sharma, Joint Secretary in the Ministry, said that OMCs are facing under-recoveries of about Rs 24 per litre on petrol and Rs 104 per litre on diesel.
"The Government of India has reduced excise duty to keep prices stable, and part of the burden is also being borne by our oil marketing companies. Currently, there is an under-recovery of about Rs 24 per litre on petrol and Rs 104 per litre on diesel," she said.
Since the beginning of the conflict in West Asia, Brent crude oil prices have surged sharply from around USD 65 per barrel to now trading above USD 100 per barrel.
This sharp rise in crude prices has increased the cost of fuel production significantly. However, as retail prices in the domestic market have not been raised, oil marketing companies are absorbing the difference, leading to losses on every litre of fuel sold.
Despite the challenging global environment, the government has assured that fuel supply remains stable across the country.
"Our retail outlets are operating normally," Sharma said, adding that crude supplies have been secured for the next sixty days and inventories are sufficient.
She further noted that refineries in the country are operating at maximum capacity. Addressing concerns about sulfur supply, she clarified that there is no shortage.
"Since our refineries are operating at maximum capacity, there is no shortage of sulfur," she said.
On the natural gas front, the government assured uninterrupted supply to domestic consumers.
"The supply of natural gas to domestic consumers is 100 per cent assured," Sharma said, highlighting ongoing efforts to expand Piped Natural Gas (PNG) infrastructure across the country.
She added that promoting PNG can help reduce dependence on LPG and ease supply pressures. The government has also issued an order stating that an additional 10 per cent commercial LPG will be provided if state governments promote PNG expansion through ease of doing business measures.
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