Oil Firms Losing ₹750 Cr Daily, Says Petroleum Ministry

Synopsis: State-run oil companies continue absorbing heavy losses of nearly ₹750 crore daily as fuel prices remain unchanged despite volatile global crude markets and ongoing geopolitical tensions impacting India’s energy supply chain.

India’s state-run oil marketing companies (OMCs) are continuing to face significant financial pressure despite a slight reduction in daily losses linked to global energy disruptions and volatile crude oil prices. According to the Ministry of Petroleum and Natural Gas, the combined daily losses of public-sector fuel retailers have now declined to around ₹750 crore per day, compared to nearly ₹1,000 crore earlier during the peak of the recent global energy shock.

The losses are primarily being absorbed by Indian Oil Corporation (IOC), Bharat Petroleum Corporation, and Hindustan Petroleum Corporation, which have continued selling petrol, diesel, and LPG at largely unchanged retail prices despite rising international crude oil costs. The government’s strategy has focused on shielding consumers from sudden fuel inflation amid geopolitical instability in West Asia and disruptions in global energy supply chains.

The financial strain intensified after tensions in the Middle East affected crude oil transportation routes and increased procurement costs for importing nations like India. Since the country imports a major portion of its crude oil requirements, fluctuations in global prices directly impact domestic fuel retailers. However, instead of passing on the full burden to consumers through fuel price hikes, oil companies have continued absorbing substantial under-recoveries.

Also Read: Defence Minister Starts Vietnam, Korea Security Visit

Union Petroleum Minister Hardeep Singh Puri recently acknowledged the scale of the challenge, stating that oil companies are still incurring heavy daily losses even after conditions improved slightly compared to earlier weeks. Officials indicated that the reduction from ₹1,000 crore to ₹750 crore in daily losses reflects some easing in crude price pressures and operational adjustments by oil companies.

Industry experts believe the situation highlights the difficult balance between economic stability and the financial sustainability of public-sector oil firms. Rising fuel prices can increase transportation costs, inflation, and pressure on household spending, particularly during periods of broader economic uncertainty. At the same time, prolonged under-recoveries could weaken the balance sheets of OMCs if global energy markets remain unstable for an extended period.

The government has not yet announced direct compensation plans for the losses, although oil companies have reportedly explored selective price revisions in industrial fuel segments and commercial categories to partially offset the burden. Analysts say future pricing decisions will likely depend on crude oil movements, geopolitical developments, and domestic inflation trends over the coming month