India's Petroleum Ministry seeks oil bonds

Indias Petroleum Ministry has sought oil bonds worth more than Rs50,600 crore (US$11.8 billion) to partly compensate state-run companies for selling fuel below cost during the first half of 2008 calendar year. The Ministry has sought Rs14,956.17 crore (US$3.49 billion) as bonds for Indian Oil Corporation (IOC), Bharat Petroleum Corporation Ltd. (BPCL) and Hindustan Petroleum Corporation Ltd. (HPCL) for the last quarter of 2007-08 and an additional amount of Rs35,672.70 crore (US$8.3 billion) for the first quarter of 2008-09 fiscal year, official sources said. For the 2007-08 fiscal year, total revenue loss on the sale of petrol, diesel fuel, domestic LPG and kerosene was put at Rs70,579 crore (US$16.5 billion). Of those, 50% was to be met through the issue of oil bonds and during April-December 2007, bonds worth Rs20,333.33 crore (US$4.75 billion) have been issued. IOC and sister state-run firms BPCL and HPCL are currently selling petrol at a loss of Rs16.70 (US$0.39) per liter, diesel fuel at Rs27.61 (US$0.64) a liter, kerosene at Rs38.09 (US$0.89) per liter and domestic LPG at a discount of Rs338.53 (US$7.90) per 14.2-kilogram cylinder. (July 22, 2008)