The three public sector oil marketing companies (OMC), including Indian Oil (IOC), Bharat Petroleum (BPCL) and Hindustan Petroleum (HPCL), have gained between 1% and 2% on reports that the Union finance ministry will compensate them with an additional Rs 14,000 crore of the Rs 19,620 crore of still-uncovered revenue losses incurred in 2009-10.
IOC is the largest gainer, up 2% to Rs 305, while HPCL and BPCL have added more than 1% each. The BSE Oil and Gas index is up 9 points, compared to a 71-points fall in the Sensex.
However, these companies would probably have to absorb the remaining loss of Rs 5,620 crore. The government paid Rs 14,954 crore as subsidy to the OMCs last year.
The OMCs currently lose Rs 6.63 on every liter of petrol they sell, while the loss on every liter of diesel and kerosene is Rs 6.25 and Rs 19.74, respectively. They are also losing Rs 254 on every cylinder of domestic LPG.