New Delhi, Sep 1 : The Union Government today ruled out an immediate reduction in petrol and diesel prices as state-run firms are still running into daily loss of over Rs 400 crore despite softening in international oil prices.
"Where is the scope for reducing prices? Oil companies are still making losses," Petroleum Minister Murli Deora told reporters.
The drop in international oil prices has resulted in revenue loss of Indian Oil, Bharat Petroleum and Hindustan Petroleum dip to Rs 400 crore per day from Rs 450 crore a fortnight back.
"Oil companies continue to lose money on sale of petrol, diesel, (domestic) LPG and kerosene. There has not been so much reduction in global prices to warrant a price cut," Petroleum Secretary R S Pandey said.
The basket of crude oil India buys averaged 111.09 dollar a barrel in the second fortnight of August as compared with 117.37 dollar per barrel in the first fortnight of the month.
Based on an average price of the second fortnight of August, retailers are losing Rs 6.31 per litre on petrol, Rs 13.69 on diesel, Rs 31.39 on kerosene and Rs 312.58 per 14.2-kg LPG cylinder.
Pandey said the revenue loss of retailers will be fully compensated, through a combination of oil bonds and assistance from upstream firms like ONGC.