Government received a written request from the state-run oil marketing companies (OMCs) to pay Rs 25,000 crore for the first six months and Rs 25,000 crore for the third quarter of 2012-13.
The compensation is towards the under-recovery incurred by the OMCs during the year for selling petroleum products below cost. So far, the companies have been partially compensated by the government in the form of subsidy.
The OMCs have written to the government seeking remaining compensation. This is inclusive of the loss the companies incur on the sale of diesel below the cost price.
From January 17, OMCs are allowed to increase the price of diesel in small doses till the loss on fuel sale was neutralised.
Following this, the OMCs raised diesel prices by 45 paise a litre (excluding taxes). The total loss incurred on sale of diesel for the nine months of the current fiscal was Rs 74,000 crore.
According to some reports, the under-recovery on diesel – bulk and retail – may fall around Rs 3,400 crore till March 31 because of the price increase in January.
But OMCs may incur an additional under-recovery of Rs 5,200 crore till March 2013 because of the government’s move to raise the cap on the number of subsidised domestic LPG cylinders per household from six annually to nine.
Leave a Reply
You must be logged in to post a comment.