'No Plans To Support Omcs For Losses On Fuel Sales'

(MENAFN- Live Mint) New Delhi: The government so far does not have any plans to provide fiscal support to the oil marketing companies (OMC ) for their revenue losses or under-recovery on the sale of petrol, diesel and aviation turbine fuel (ATF), said Sujata Sharma, joint secretary, Union ministry of petroleum and natural gas.

OMCs are incurring losses on the sale of petrol, diesel, and ATF for domestic flights due to high crude oil prices amid the crisis in West Asia and the resultant supply disruption that has persisted for over two months now.

“As of now, there is no proposal before the government to support OMCs,” she said during the media briefing on the fuel situation in the country.

Jet fuel prices for domestic airlines were increased by 25% in April, about one-fourth of the required increase commensurate with the global oil price surge; the rates were kept unchanged for this month. ATF prices for international airlines have, however, been increased by over 5% starting 1 May.

Similarly, despite under-recoveries of about ₹20 per litre in petrol sales and about ₹100 per litre in diesel sales, according to data cited by the government, there has been no increase in the prices of regular petrol and diesel.

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Further, domestic LPG prices were kept unchanged during the latest round of price revision on 1 May, while commercial LPG prices were increased by nearly ₹1,000 per cylinder. Prices of domestic LPG were last raised by ₹60 per cylinder in March.

The Centre has earlier supported OMCs through budgetary support to cover their under-recoveries.

On the recent price hike in select products, Sharma said: "There is no increase in MS (motor spirit or petrol), HSD (high speed diesel). There is also no increase in domestic LPG prices. But this is also a fact that our supplies have been disrupted, and there is a tightness in the market. The international prices of crude, LPG and natural gas have witnessed a significant jump."

Protecting retail consumer

Noting that the consumers impacted by the recent hike in prices, comprise of about 90% of the overall diesel and LPG sales, she said: "So, every effort has been done to protect the retail consumer... So, the government and the companies have taken care of the interests of the common people."

Further, data from the Petroleum Planning & Analysis Cell on Monday showed that LPG consumption in the country declined 16.16% year-on-year in April to 761,000 metric tonnes amid supply shortage, while that of petrol rose by 6.36% to 3.45 million tonnes.

Sharma cited the mandated 45-day booking period for domestic LPG cylinders in rural areas and restrictions on supplies for commercial consumption as key factors behind the drop in demand in April 2026.

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“It is correct that LPG consumption has witnessed a decline, and there are several reasons. If you look at it... We have increased the booking period for rural consumers. So, that was an effort from our part to manage the demand. Another major reason is that commercial supplies have been restricted to 70%. The third reason is that the delivery authentication code has significantly curtailed the diversion of domestic cylinders towards commercial usage,” she said.

Diesel sales rose 0.25% on-year in April to 8.28 million tonnes, while ATF sales fell 1.37% to 7.72 million tonnes.

India is the third-largest consumer and importer of crude oil, and the annual demand has been hitting record highs for the past few years. In 2025-26, India's petroleum product demand was at 243.19 million tonnes, and it is projected to reach 250 million tonnes in 2026-27.

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