Home · Business · Sep 9 archive
Fuel Retailers Losing Over Rs 20 on Diesel Amid Crude Price Surge
Confirmed
In Short: Public sector fuel retailers in India are facing significant financial losses, with estimated losses of over Rs 20 per litre on diesel sales and Rs 5 per litre on petrol sales due to rising global crude oil prices.
Despite narrowing over the past two to three months, the losses are now widening again amid the recent spurt in global prices, putting additional pressure on the OMC finances. For over three months, retail petrol and diesel prices have remained unchanged, with the last revision in May by a total of Rs 7.35 per litre for petrol and Rs 7.53 per litre for diesel in four rounds.
Prashant Vasisht, senior vice president and co-group head, corporate ratings at ICRA, stated, 'At the average price for the month of September till date, marketing margins on petrol are negative Rs 5/litre and diesel at negative Rs 23/litre, and under recoveries on domestic LPG are at Rs. 200/cylinder.
The OMCs continue to incur losses on retail fuel sales despite the recent price hikes, with fuel retailers estimated to be losing over Rs 20 on diesel sales and about Rs 5 on petrol sales.
What's still developing
- With the jump in crude oil and petroleum product prices globally amid fresh flare-ups in the ongoing West Asia conflict, public sector fuel retailers are currently estimated to be losing about Rs 5 per litre on retail petrol sales and over Rs 20 on diesel sales, according to industry analysts and experts.
- Amid the West Asia conflict, which has been on for over six months now, public sector oil marketing companies (OMCs) — Indian Oil, Bharat Petroleum, and Hindustan Petroleum — only partially passed on to retail consumers the international price increase in fuels like petrol, diesel, and liquefied petroleum gas (LPG), resulting in heavy losses to the companies.
- If you're looking for a seasonal refresh, big-box retailers are offering huge discounts across almost every category.
- We won't see discounts this big again until Black Friday, so now's the time to act — especially with tech and appliance prices continuing to climb.