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India's Fuel Woes: OMCs Bleed $104/Ltr on Diesel
2 Apr
Summary
- Oil firms face massive losses due to global crude price surge.
- Diesel under-recovery reaches Rs 104 per litre.
- Fuel supply remains stable with 60 days of crude secured.
Oil marketing companies (OMCs) in India are currently incurring significant financial losses as global crude oil prices surge past $100 per barrel amid the West Asia conflict. These under-recoveries amount to approximately Rs 24 per litre on petrol and a staggering Rs 104 per litre on diesel. The government has reduced excise duty to mitigate price hikes, with OMCs also absorbing a portion of the burden.
Despite the volatile international market, fuel supply within India remains stable. Officials confirmed that retail outlets are operating normally, and crude supplies are secured for the next sixty days. Refineries are functioning at maximum capacity, ensuring adequate product availability and alleviating concerns about sulfur shortages.
In parallel, the government is emphasizing the expansion of Piped Natural Gas (PNG) infrastructure to reduce reliance on LPG and ease supply pressures. An incentive offers additional commercial LPG if state governments facilitate PNG expansion through business-friendly measures.
