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Finance Ministry's Rs. 25,000 crore largesse could push oil firms into profit |
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New Delhi: Indian Oil, Bharat Petroleum and Hindustan Petroleum have a reason to cheer just before they announce their third quarter results this week, courtesy the Finance Ministry.
On Monday, the North Block sent letters of comfort detailing a payout of Rs.25,000 crore in compensation to the three public sector oil marketing firms for the subsidy they provide in the sale of diesel, cooking gas (LPG) and kerosene.
Of the Rs.25,000 crore, Indian Oil will get Rs. 13,474.56 crore, BPCL Rs. 5,987.25 crore and HPCL Rs. 5,538.19 crore. The Finance Ministry has already given Rs. 30,000 crore in subsidy to the oil firms in the first two quarters.
The actual disbursement, based on the comfort letter of the ministry, will be made after Parliament has approved the supplementary demands for grants in the forthcoming Budget session.
IOC, BPCL and HPCL sell diesel at a discount of Rs.9.22 every litre, kerosene at a discount of Rs. 31.6/litre and LPG cylinder at a discount of Rs. 481, and in the process lose a whopping Rs. 443 crore per day.
Total under recovery or losses for the three PSUs for the third quarter (October-December) has been estimated at Rs. 39,268 crore. Of the total loss in the third quarter, Rs. 15,000 crore will paid by upstream PSUs Oil & Natural Gas Corp (ONGC), GAIL and Oil India. Upstream PSUs have paid Rs. 45,000 crore in the first three quarters as subsidy to the oil marketing PSUs.
Source : profit.ndtv.com
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