Oil cos not to recoup losses arising from Re 1/ltr subsidy on petrol, diesel

State-owned oil firms have no plans to recoup losses they made on subsidising petrol and diesel by Re 1 per litre even though rates have now become at par with the cost, top officials said.

Scrambling to contain spiraling prices, the government on October 4 last year cut excise duty on petrol and diesel by Rs 1.50 per litre each and asked PSU oil firms to absorb another Re 1 a litre. This immediately resulted in a Rs 2.50 per litre decline in prices which had touched an all-time high on rising international rates.

"We are not recovering any of the losses," Indian Oil Corp (IOC) Chairman Sanjiv Singh told reporters here.

IOC along with Hindustan Petroleum Corp Ltd (HPCL) and Bharat Petroleum Corp Ltd (BPCL) took a hit of about Rs 4,500 crore from absorbing Re 1 a litre hike.

"When prices were going up, the government requested us to consider absorbing Re 1 per litre and we lowered the price by Re 1 per litre," he said. "But subsequent to that rates have been on the decline which we have passed on to consumers on each single day."
He said since mid-October petrol price has fallen by Rs 14.18 per litre and diesel by Rs 13.03 per litre. "We passed on all of the decline in international prices to consumers."