Public sector oil companies are making close to Rs 15 a litre profit on the sale of petrol and over Rs 3 per litre on diesel, strengthening the case for a retail fuel price cut.
Indian Oil Corporation (IOC), Bharat Petroleum Corporation (BPCL) and Hindustan Petroleum Corporation (HPCL) have seen widening of profit on sale of petrol and diesel, the first in three years, on the back of falling international oil prices, industry sources said.
The three firms, who till last week were making a margin of Rs 9.86 a litre on petrol and Rs 0.70 per litre on diesel, have from today started earning Rs 14.89 a litre on petrol and Rs 3.03 per litre on diesel.
However, they continue to lose Rs 17.26 on the sale of every litre of kerosene through public distribution system (PDS) and Rs 148.32 per 14.2-kg domestic LPG cylinder.
Sources said, the position on fuel prices is likely to be put before the Cabinet soon for a decision on reducing petrol and diesel prices.
Oil firms revise prices twice a month, on the 1st and 16th of every month based on the average imported price for the preceeding fortnight. But the revised prices are not passed on to consumer as government administers retail rates.
Based on the average international oil price in the second fortnight of November, the state-run firms earn a margin of Rs 44 crore per day on petrol and Rs 42 crore a day on diesel. They, however, lost Rs 66 crore a day on sale of kerosene and Rs 29 crore per day on LPG.
The fall in international oil prices will result in lower revenue loss on fuel sales this fiscal. IOC, BPCL and HPCL will end the 2008-09 fiscal with Rs 109,190 crore revenue loss, Rs 92,853 crore of which has already been accounted for in the first half of the fiscal.
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