OMC under-recoveries decline 83 pc to Rs 3 per litre on petrol

New Delhi, June 15 (IANS) The financial burden on oil marketing companies (OMCs) has eased significantly following a series of fuel price hikes and government support measures, with under-recoveries on petrol and diesel witnessing a sharp decline, according to data shared by Sujata Sharma, Joint Secretary in the Ministry of Petroleum and Natural Gas on Monday.

The latest figures show that under-recoveries on petrol have fallen by 83 per cent to Rs 3 per litre from Rs 24 per litre recorded on April 1.

Similarly, diesel under-recoveries have declined by 75 per cent to Rs 27 per litre from Rs 105 per litre during the same period.

The reduction reflects the impact of four fuel price revisions undertaken by the Centre in May, along with fiscal support extended to oil retailers amid elevated global crude oil prices.

Under-recoveries had come down to around Rs 600 crore per day in May after the fourth round of fuel price increases.

This marked a further improvement from nearly Rs 750 crore per day reported on May 18.

In the last week of May, the government approved an average fuel price increase of Rs 2.7 per litre, a move that was expected to help OMCs reduce their overall losses by at least 44 per cent.

The four phased revisions, implemented on May 15, 19, 23 and 25, increased petrol prices in Delhi from Rs 94.77 per litre to Rs 102.12 per litre.

Diesel prices in the national capital rose from Rs 87.67 per litre to Rs 95.20 per litre during the same period.

The improvement in OMC finances comes after the Centre absorbed a significant portion of the burden by reducing excise duties on petrol and diesel.

According to the government, the move resulted in a revenue sacrifice of approximately Rs 1.23 lakh crore over a period of 78 days, helping shield consumers from the full impact of rising global fuel prices.

Meanwhile, global crude oil prices declined by nearly 5 per cent on Monday after the United States and Iran reached an agreement and announced the reopening of the Strait of Hormuz, easing concerns over disruptions to global energy supplies.

–IANS

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