Selling diesel at ₹20-25 a litre below cost and petrol at ₹14-18 per litre below cost, as a result of a price freeze despite soaring crude rates is unsustainable, an industry body representing private fuel retailers like Jio-bp and Nayara Energy has told the Oil Ministry and has sought its intervention to create a viable investment environment.
On June 10, the Federation of Indian Petroleum Industry (FIPI), which besides private fuel retailers also counts state-owned firms such as IOC, BPCL and HPCL as its members, wrote to the Petroleum Ministry saying losses on petrol and diesel will limit further investments in retailing business.
International crude oil and product prices have risen sharply to a decade high but state-owned fuel retailers, who control 90% of the market, have frozen petrol and diesel prices at rates equivalent to two-third of the cost.
