For the first time in more than a year, oil companies will make profit on sale of petrol but a price cut does not appear to be on the horizon yet as they continue to lose over Rs 155 crore per day on sale of diesel, domestic LPG and kerosene.
"Margins on gasoline (petrol) will turn positive tomorrow.
Based on the average oil price of second fortnight of October, we expect to make Rs 4.12 a litre (margin), IOC Chairman Sarthak Behuria told reporters here.
But IOC, Bharat Petroleum and Hindustan Petroleum will continue to make losses on diesel, domestic LPG and kerosene.
"Losses on diesel will come down to Rs 0.96 per litre. On kerosene we continue to lose Rs 22.40 per litre and on LPG the losses stand at Rs 343.49 per cylinder," he said.
The margins till today were based on the average oil price of first fortnight of October and those from tomorrow would be based on average of second fortnight of October.
"We (IOC) continue to lose Rs 85 crore per day on sale of diesel, kerosene and LPG. We will make about Rs 6 crore on petrol but overall our losses on fuel sales stand at Rs 79 crore per day," said IOC Director (Finance) S V Narasimhan.
Industry would make Rs 155 crore loss per day on fuel sales.
Behuria said there was no case for a cut in fuel prices till the losses existed. "It is too early for passing on any softening in international oil prices. Firstly, we need to look at the monthly average before deciding if we have broken even on all products. Plus, there has to be cross-subsidy, somebody has to pay for selling LPG and kerosene below cost."
"What benefit to pass on to whom? Already consumers are protected. You never said the prices should be raised to market level when oil touched $147 per barrel," he retorted.