Global oil crisis: Oil companies incurring loss but no plans to hike petrol, diesel prices, says Govt

Global oil crisis: State-run fuel retailers are facing losses of around Rs 20 per litre on petrol and nearly Rs 100 per litre on diesel, as retail prices have remained unchanged for almost four years despite a sharp rise in global oil rates, the government said on Thursday. It also indicated that there is no immediate plan to increase fuel prices.

Rejecting reports suggesting a possible hike of Rs 25–28 per litre in petrol and diesel after the assembly elections, the Ministry of Petroleum and Natural Gas (MoPNG) said on X that “no such proposal is under consideration.”

At a media briefing on developments in West Asia, Sujata Sharma, Joint Secretary in the ministry, noted that international crude oil and LPG prices have been highly volatile, but the government has chosen not to pass on the increase to consumers.

Crude which was USD 70 per barrel last year, averaged over USD 113 this month, she said. “There is a huge increase… inspite of that the government has not increased prices and the effort of the government has been to keep the prices stable.” Retail petrol and diesel prices have remained frozen since early April 2022 — a period during which oil prices rose in some months and fell in other times. When prices fell, state-owned oil firms made handsome profits, which they used to set off losses when rates rose.

After the Iran war, oil prices spiked from around USD 70 per barrel to USD 119 before seeing some correction. Renewed tensions have pushed Brent — the world’s most known crude oil benchmark — to USD 103-106 per barrel.

Despite a more than 50 per cent rise in input crude oil prices, petrol and diesel rates have remained unchanged in India. Petrol is priced at Rs 94.77 a litre in the national capital and diesel comes for Rs 87.67.