OMCs Bear Losses as Global Oil Prices Cross $100 Per Barrel
Oil Marketing Companies (OMCs) in India are incurring substantial losses on fuel sales as global crude oil prices continue to rise amid the ongoing West Asia conflict, even as domestic retail prices remain unchanged.
Addressing reporters during an inter-ministerial briefing on Thursday, Sujata Sharma, Joint Secretary in the Ministry of Petroleum and Natural Gas, said OMCs are currently facing under-recoveries of approximately Rs 24 per litre on petrol and Rs 104 per litre on diesel.
She said the government has reduced excise duty to cushion consumers from rising global prices, while a portion of the burden is being absorbed by oil marketing companies.
The surge in global crude prices has been sharp, with Brent crude rising from around USD 65 per barrel to above USD 100 per barrel since the onset of the West Asia conflict. This increase has significantly raised the cost of fuel production.
However, with no revision in retail fuel prices, OMCs are bearing losses on every litre sold.
Despite the global volatility, the government has maintained that fuel supply remains stable across the country. Retail outlets are functioning normally, and crude supplies have been secured for the next 60 days, with sufficient inventories in place.
The ministry also stated that domestic refineries are operating at maximum capacity. Addressing concerns related to sulfur availability, Sharma clarified that there is no shortage.
On natural gas, the government assured uninterrupted supply to domestic consumers. It also highlighted ongoing efforts to expand Piped Natural Gas (PNG) infrastructure to reduce dependence on LPG.
Additionally, the government has issued an order to provide an extra 10 per cent commercial LPG allocation to states that promote PNG expansion through ease of doing business measures.
-ANI
