No Slashing Fuel Prices...

<?xml version="1.0" encoding="UTF-8"?><root available-locales="en_US," default-locale="en_US"><static-content language-id="en_US"><![CDATA[Ruling out an immediate reduction in petrol and diesel prices, Prime Minister Manmohan Singh has said the government will wait till public sector oil companies break-even on fuel sales before considering such a move. International crude oil prices have slid from an all-time high of $147 to $60 a barrel, but public sector oil companies continue to make losses on sale of diesel, domestic LPG and kerosene. &quot;When we see that the Indian oil companies are able to sustain a reduction that will be the right (time for such a) decision,&quot; he told reporters on way back from his three-day maiden visit to the energy-rich Gulf region. Though Indian Oil Corp, Bharat Petroleum and Hindustan Petroleum have started making profit on sale of petrol, they lose about Rs 155 crore per day on sale of other three products. &quot;Oil companies have to bear a very heavy burden (and) there are limits to which government can go on subsidising,&quot; he said. Government compensates half of the revenue loss on fuel sales through oil bonds and one-third of the losses are borne by cash-rich firms like ONGC. Yet, IOC posted its largest-ever net loss of Rs 7,047.13 crore in July-September quarter. BPCL posted a net loss of Rs 2,625.17 crore in the second quarter on top of Rs 1,066.70 crore in April-June, while HPCL reported a loss of Rs 888.12 crore in Q1 and another Rs 3,218.92 crore in Q2. &quot;If prices keep on going down, we can explore these possibilities (of reducing prices),&quot; the Prime Minister said. Oil firms make a profit of Rs 4.12 a litre on petrol but lose Rs 0.96 on every litre of diesel, Rs 22.40 per litre on kerosene and Rs 343.49 per LPG cylinder. The Prime Minister said besides domestic LPG and kerosene the government had also been subsidising diesel, the most consumed fuel in the country. &quot;We have been subsidising kerosene, we have been subsidising diesel... But there are limits,&quot; he said. State-run IOC, BPCL and HPCL are projected to lose Rs 1,28,135 crore in revenues on fuel sales this fiscal. The companies would have achieved break-even on fuel sales by now but for the 20 per cent devaluation of Indian rupee against the US dollar. Every time the rupee depreciates by one against the US dollar, the revenue loss or under-recoveries go up by Rs 8,000 crore on an annualised basis. Similarly, every dollar increase or decrease in crude oil prices has an impact of Rs 3,000 crore a year. IOC, BPCL and HPCL lost Rs 92,853 crore on fuel sales (audited figures) in April-September and they are projected to lose Rs 35,282 crore in the second half of 2008-09 fiscal. (PTI)