Simultaneously, Hindustan Petroleum Corp Ltd (HPCL), the nation's third largest fuel retailer, also posted a net loss of Rs 9,249 crore in April-June, the second biggest quarterly loss by a listed corporate.
The government has in the year year not compensated oil firms for selling diesel, domestic LPG and kerosene below cost this year as the Rs 40,000 crore fuel subsidy it had budget has all been exhausted in paying compensation for last fiscal.
Bharat Petroleum Corp Ltd (BPCL), India's second largest fuel retailer, will report quarterly earnings tomorrow and is likely to post over Rs 9,000 crore of net loss.
IOC, which like other retailers is living off borrowed money, warned that it may soon exhaust the limit to which it can take debt and sourcing crude oil (raw material for making petrol, diesel and other petroleum products) would become difficult as international sellers don't give credit.
The three state-run fuel retailers are losing about Rs 710 crore per day on selling diesel, domestic cooking gas (LPG) and kerosene at government controlled rates which are way below market price.
Besides, the government's "inflationary concerns" have not allowed them to raise price of petrol - a fuel that was deregulated in June 2010 - even though they are losing over Rs 3 per litre.
IOC Chairman R S Butola said the government should realise that oil firms are on the brink and fuel subsidies need to be addressed urgently.
The three fuel retailers are projected to lose a record Rs 177,715 crore this fiscal as they sell diesel at a discount of Rs 12.13 a litre to its cost, kerosene at Rs 28.54 and LPG at Rs 231 per 14.2-kg cylinder discount. (MORE)