Deora demands relief for PSU oil firms

Petroleum Minister Murli Deora today met Prime Minister Manmohan Singh and Finance Minister P Chidambaram to demand a compensation package to PSU oil marketing companies for selling petroleum products at subsidised prices.

"The compensation package sought by Deora includes issue of oil bonds, possible restructuring of excise duty on diesel and hike in prices of petrol and diesel," a senior petroleum ministry official said.

Petroleum Secretary MS Srinivasan had told Business Standard last week that the Union Cabinet was expected to review auto fuel prices this week. He, however, had added that a hike in retail prices of petrol and diesel was unlikely.

He had said the Cabinet may also approve issue of bonds worth Rs 24,000 crore to the state-run oil marketing companies for the current fiscal.

The three state-run oil marketing companies "� Indian Oil Corporation, Hindustan Petroleum Corporation and Bharat Petroleum Corporation "� are together losing around Rs 200 crore per day due to cap on the retail prices of petrol, diesel, LPG and kerosene.

The total revenue loss of the three companies for the current year is estimated to be around Rs 54,000 crore. In the last financial year, the total revenue loss was around Rs 49,000 crore.