RS Butola, Chairman of Indian Oil Corp (IOC) informed reporters that the under-recoveries incurred by state-run oil marketing companies (OMCs) on the sale of diesel, LPG and kerosene may fall to Rs 112,000 crore from the earlier estimate of Rs 130,000 crore.
The under-recoveries may decline because of the fall in the international crude oil price. But he said the estimated under-recovery for 2013-14 is based on the forecast of subdued oil prices during the financial year and it is too early to make any projection.
Oil firms currently sell diesel at a loss of Rs 7.34 a litre, kerosene at Rs 32.02 per liter and LPG at Rs 434.50 per 14.2-kg cylinder. They lose Rs over 320 crore per day on sale of the three fuels.
In 2012-13, the under-recovery incurred by the three OMCs -IOC, Hindustan Petroleum Corp (HPCL) and Bharat Petroleum Corp ( BPCL)- stood at around Rs 160,000 crore.
In Jan-Mar 2013, the three OMCs incurred under-recovery of about Rs 40,000 crore. IOC alone would lose Rs 60,000 crore this fiscal, he said.
The government, which had previously provided Rs 55,000 crore towards fuel subsidy, has provided another Rs 25,000 crore for 2012-13.
Upstream firms like ONGC would contribute another Rs 60,000 crore. There would still be Rs 21,000 crore-odd uncovered under-recovery which will be carried forward in the next fiscal, Butola said.