On mounting losses IndianOil may seek regulation of petrol with Govt
New Delhi   10-Aug-2012

IndianOil reported its highest ever loss of Rs 22,451 crore in any quarter for the period ending June 30 2012 over unmet under realisation of Rs17,485 crore on sale of subsidised common man's fuel items like kerosene, LPG and diesel as well as the depreciation of rupee against the dollar, the State-owned company indicated that it would seek regulation of petrol prices with the Government even as it kept quiet on possibility of any gasoline price hike.

"This is the highest ever loss reported in any quarter by us. The previous occasion when we had suffered a similar kind of loss was that of Rs7, 038 crore in the second quarter of 2008-09," IndianOil Chairman R S Butola said.

The company had a net loss of Rs22, 450.95 crore in April-June quarter as compared to Rs3,718.70 crore loss in the corresponding period last year. Also due to non-revision in retail selling prices in line with the international prices, the company has suffered net under-realisation of Rs17, 484.92 crore on sale of diesel, kerosene and LPG.

Sounding hassled, Butola repeatedly underlined the fact that the growing gap between domestic and global oil prices and the non payment of compensation amount has been putting constant pressure on the Maharatna Company’s finances and at the same time is yet to be compensated for the losses it is incurring on selling kerosene, LPG and diesel at subsidised rates.

Director (Finance) of IndianOil, PK Goyal said that there was a limit to which the company could borrow from banks as they have their own lending norms and that they cannot go on lending.

IndianOil as well as the two other oil marketing companies namely HPCL and BPCL are yet to be compensated as the Government has exhausted all its budgetary provisions earmarked for the purpose.

Even Butola acknowledged this fact and said that currently there is no budgetary provision available with the Government (for paying compensation), and therefore the problem is likely to continue.