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No bailout for state-run oil companies for now
The Centre on Monday ruled out any immediate bailout package for state-run oil companies despite losses linked to the ongoing West Asia crisis.
“There is no proposal for any support package to oil-marketing companies right now,” Sujata Sharma, joint secretary in the Union petroleum ministry, said during an inter-ministerial briefing in New Delhi.
The clarification came as concerns grew about under-recoveries, the gap between the cost of producing fuels such as petrol, diesel and liquefied petroleum gas and their retail selling prices.
Union Minister of Petroleum and Natural Gas Hardeep Singh Puri said on Sunday that oil companies were facing under-recoveries of around Rs 2 lakh crore, with losses of up to Rs 1 lakh crore projected in the current quarter.
Puri said on social media that oil companies were purchasing crude oil, gas and LPG at elevated international prices while continuing to sell fuels at unchanged retail rates to shield consumers, leading to losses of up to Rs 1,000 crore a day.
He added that despite this “uninterrupted energy imports and supply” had been maintained.
Secretary of the Ministry of Petroleum and Natural Gas Neeraj Mittal also said there was no shortage of fuel and no plan to introduce rationing, Deccan Herald reported.
Speaking at a business summit in Delhi he said the government had absorbed part of the price shock through measures including excise duty cuts on petrol and diesel.
India has remained “a relative oasis of calm” compared to several other countries that have imposed fuel rationing and stricter demand curbs, the news outlet quoted Mittal as saying.
Prime Minister Narendra Modi on Monday reiterated his call to citizens to reduce fuel consumption in response to global uncertainty linked to the West Asia war.
Addressing a public event in Vadodara, Modi urged people to work from home where possible, use public transport and opt for car-pooling.
“The West Asia crisis is one of the worst in the decade,” the prime minister said. “Just as we overcame the COVID-19 pandemic, we will come out of this also.”
During the joint press briefing on Monday, Joint Secretary in the Ministry of Information and Broadcasting Senthil Rajan said Modi’s remarks were intended to encourage efficient use of resources rather than signal shortages.
“The idea [of the speech] is for optimum and efficient utilisation of available resources,” he stated. “It is not as if there is a shortage; there are adequate stocks, and arrangements are in place.”
On Sunday as well, while addressing a rally in Hyderabad, Modi had called for “nationally responsible” lifestyle choices and urged citizens to place “the country above all else” during the crisis.
Among the measures he proposed were reviving work-from-home practices adopted during the Covid-19 pandemic, avoiding non-essential foreign travel for a year and reducing edible oil consumption.
Benchmark Brent crude was trading at $105.2 per barrel on Tuesday. The price of Brent was $78 per barrel on February 27, a day before the conflict started.
Petrol in Delhi is currently priced at Rs 94.7 per litre, diesel at Rs 87.6 per litre and domestic liquified petroleum gas at Rs 913 per 14.2-kg cylinder.
Written by Sara Varghese. Edited by Tanya Shrivastava
Source: Scroll
Related Posts: India, West Asia war, Oil prices, Oil trade, Oil supply India, LPG price India, India - West Asia war impact, Strait of Hormuz, Narendra Modi
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