Last week, the government increased the prices of petrol and diesel by Rs 3 per litre. Indian fuel retailers are still losing money. According to experts, fuel retailers are not even covering their costs. They need another Rs 25 per litre hike to make a profit from marketing. According to these analysts, oil marketing companies (OMCs) are losing Rs 1380 crore every day. According to analysts, oil marketing companies are currently losing Rs 25 per litre (on average) on petrol and diesel. If LPG is also included, their daily losses increase to a whopping Rs 1380 crore.
The brokerage firm estimates that if losses continue at this rate, Indian Oil Corporation (IOCL), Bharat Petroleum (BPCL) and Hindustan Petroleum (HPCL) will lose their entire balance sheet equity within 10, 4 and 2 years, respectively. HPCL is the most at risk. HPCL’s large marketing network has had the biggest impact on its integrated margins. According to the firm’s estimates, the company is currently losing $19 per barrel on an integrated basis. In comparison, IOCL is losing $4 per barrel and BPCL is losing $8 per barrel, while before the current oil crisis, all three companies were making profits of $12 to $14 per barrel.