He added that IOC was fast running out of its capacity to borrow money from banks. With a borrowing limit of Rs 50,000 crore from banks, the company has already used up 70 per cent with total borrowings now at Rs 35,000 crore. "In another 3-4 months we will borrow the remaining," he said.
A combination of price rise, duty cuts, and subsidies could be a solution to problems that oil companies are facing, he said.
Behuria said the government has agreed to compensate 50 per cent of the under-recoveries due to price subsidy. The estimated amount given by the finance ministry stands at Rs 70,000 crore. He added that oil companies have estimated this at a 10 per cent higher level, or Rs 77,000 crore. He also said that upstream oil companies will contribute about Rs 27,000 crore, while the rest would be borne by oil-marketing companies.
Speaking about increase in crude oil price he said, with the current projection, all oil-marketing companies will loose around Rs 2,00,000 crore in 2008-09. Behuria noted that with crude prices soaring, the under-recoveries of oil companies are estimated to be in the region of Rs 1,60,000 crore for the current fiscal.