Indian government to pay 60.3% of total revenue loss by stated-owned OMCs

India’s Minister of State for Petroleum and Natural Gas, R.P.N. Singh, informed Parliament that the Indian government will bear 60.3% of the total revenue loss incurred by state-owned oil marketing companies (OMCs) from April 2011 to March 2012 on the sale of petroleum fuels at regulated prices. The three state-owned companies, namely Indian Oil Corporation Ltd., Bharat Petroleum Corporation Ltd. and Hindustan Petroleum Corporation Ltd., had a total revenue loss of Rs1.38 trillion (US$22.,8 billion) from 2011-2012. The Indian government will shoulder Rs835 billion (US$14.64 billion), by far the highest compensation payout to the sector. The government had already paid Rs 450 billion (US$7.89 billion) from April to December last year, and has now agreed to pay the remaining Rs385 billion (US$6.75 billion) for losses incurred from January to March this year.”The public sector oil marketing companies have intimated that in case the prevailing under-recoveries are not compensated, it may adversely impact the supply-demand balance of petroleum products,” Singh explained. (May 22, 2012)