The government today issued bonds worth Rs 22,000 crore to oil marketing companies to compensate them for their under-recoveries on sale of petroleum products in the domestic market.
The 16-year bonds carry 6.35 per cent coupon rates, an official statement said.
Indian Oil Corporation will get bonds worth Rs 11,975.51 crore, Bharat Petroleum Corporation will receive bonds worth Rs 5,330.76 crore and Hindustan Petroleum Corporation will be issued bonds worth Rs 4,693.73 crore.
The investment in these bonds will not be counted against the mandatory requirement for banks and insurance companies to keep part of their deposits in government-approved securities.
Oil marketing companies are partially compensated for losses they incurred on selling petroleum products at administered prices.
However, global oil prices have come down sharply to less than $40 a barrel from the peak of $147 a barrel in July.
The government earlier this month slashed petrol prices by Rs 5 a litre and diesel by Rs 2 a litre to pass on the benefit of softening global crude oil rates.