New Delhi: The government has no plans to deregulate diesel, cooking gas (LPG) and kerosene prices by withdrawing subsidy on them, Minister of State for Petroleum R.P.N. Singh said today.
“At present, there is no such proposal,” the minister said in a written reply to the Rajya Sabha, in which he also gave data on the under-recovery or revenue losses incurred by state-run oil companies.
“The government is providing subsidy of Re.0.82 per litre on PDS kerosene and Rs.22.58 per 14.2 kg LPG cylinder on domestic LPG.”
The minister added: “The public sector oil marketing companies (OMCs) also incur under-recovery on sale of diesel, PDS kerosene and domestic LPG as the prices of these products are being modulated by the government.”
To compensate FY 2011-12 combined revenue losses of Rs.138,541 crore of the three Oil marketing companies, the government gave Rs.83,500 crore assistance to them, while upstream firms like Oil and Natural Gas Corp. (ONGC) contributed Rs.55,000 crore.
According to the minister, Rs.41 crore was borne by the OMCs. Indian Oil, Bharat Petroleum and Hindustan Petroleum currently lose about Rs.450 crore per day on sale of diesel, domestic cooking gas (LPG) and kerosene.
Losses to OMCs on account of domestic LPG, for instance, amount to Rs.231 per 14.2 kg cylinder.
Petrol prices were deregulated in June 2010 but subsequent price revisions by OMCs have been done in guarded manner so as not to stoke inflation. The losses on account of petrol work out close to Rs.3.80 per litre.