Oil companies are incurring a loss of Rs 20 to 25 per liter on the sale of diesel and Rs 14 to 18 on petrol. This loss is being caused due to the increase in the prices of crude oil despite the rise in prices. These companies have written a letter to the Petroleum Ministry demanding appropriate steps be taken in this regard.
Companies like Jio-BP and Naira Energy have warned the government about this. However, earlier the Federation of Indian Petroleum Industry (FIPI) had told the Petroleum Ministry on June 10 that the loss on the sale of petrol and diesel would limit investment in retail business. FIPIs include Indian Oil Corporation (IOC), Bharat Petroleum Corporation (BPCL) and Hindustan Petroleum Corporation (HPCL) apart from private sector companies.
Retail fuel prices have not increased since April 6. At the same time, the price of fuel sold to bulk buyers like state transport undertakings has increased in line with international prices. FIPI said that due to this a large number of wholesale buyers are buying from retail outlets, which is adding to the losses of private sector companies.
Oil companies have appealed to the government to intervene in this matter. FIPI said that all the petroleum companies in the private sector are investing heavily in the retail sector. But at this time he is facing a difficult situation. This is affecting the ability of private companies to invest as well as operate. They are also unable to expand their network.
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According to a report, due to the rise in the price of crude oil in the international market, the prices have reached the highest level of a decade. But government fuel retailers have stabilized petrol and diesel prices. Government companies account for 90 per cent of the fuel retail business. At present, the fuel prices are only at two-thirds of the cost cost, which is hurting private companies. For companies like Jio-BP, Naira Energy, this has created a crisis of losing their customers.