The three firms are faced with a huge liquidity crunch and are borrowing Rs 3,500 crore a month to meet day-to-day expenditure.
According to an official, borrowings of the three firms have reached Rs 65,000 crore. The government's bar on oil firms from raising fuel prices despite cost of raw material (crude oil) doubling to over 120 dollars a barrel, is likely to see the three firms end the current year with a revenue loss of Rs 2,00,000 crore.
Last year, the revenue loss was Rs 77,304.50 crore. While stopping the issuance of new LPG connections would help limit the Rs 305.90 per cylinder loss.
The government makes up for 42.7 per cent of the under realisation of oil companies on fuel sales through issuance of oil bonds, while 33 per cent of the losses is compensated by companies like ONGC and GAIL.
