Date:20/04/2005 URL: http://www.thehindubusinessline.com/2005/04/20/stories/2005042001390200.htm

Back Oil marketing PSUs lose Rs 1,300 cr in two weeks

Pratim Ranjan Bose

Kolkata, April 19

UNDER-RECOVERY on account of subsidised LPG and kerosene and price under-realisation on account of petrol and diesel have taken an abnormal toll in 2005-06.

During the first fortnight of April, the oil marketing PSUs have lost a total of Rs 1,300 crore on both counts.

Of the total, IOC took a hit of close to Rs 650 crore. HPCL and BPCL each lost in the range of 300 crore.

While non-revision of prices of petrol and diesel even in the face of unprecedented crude price rise was a major reason for under-realisation, the loss was further inflated due to the additional excise burden and the 50 paise cess.

It may be mentioned that Indian crude import prices crossed $50 a barrel during the first week of April compared to $30 during the same period in the previous year.

IOC, the largest oil marketing company, had suffered a total loss of Rs 8,418 crore in 2004-05, of which Rs 7,332 crore was due to under-recovery and Rs 1,086 crore due to under-realisation.

"While we had accepted under-recovery on LPG and kerosene as a fait accompli, under-realisations are much higher so far," said an IOC official.

The company has lost close to Rs 300 crore due to under-realisation in the first fortnight.

Sources in HPCL and BPCL confirmed under-realisation to the tune of Rs 140-150 crore each.

According to Mr Sarthak Behuria, Chairman of IOC, non-revision of production prices after November last year and the excise and cess all put together has led to under-realisation of close to Rs 5.50 paise per litre in HSD and a little below Rs 5 in petrol.