by Theleaders | May 12, 2026 5:48 pm
NEW DELHI, May 12 — India will at some stage need to assess how long state-run fuel retailers can sustain losses from selling transport fuels below market prices, oil minister Hardeep Singh Puri said at an industry event today.
Petrol and diesel spot prices have surged to multi-year highs globally as the Middle East conflict disrupted supply, but governments in several major economies have held down pump prices to shield consumers from inflation.
A joint secretary in the oil ministry, Sujata Sharma, had earlier said that India had no plans to compensate oil marketing companies for these losses.
Fuel retailers are incurring losses of about 100 rupees (RM4.11) per litre on diesel and 20 rupees per litre on petrol, Sharma said last month.
India is the world’s third-largest oil importer and consumer, meeting more than 90% of its crude oil needs and about half of its natural gas demand through imports.
Indian state fuel retailers, including Indian Oil Corporation, Hindustan Petroleum and Bharat Petroleum, which account for most of the fuel sales in the country, have not raised gasoline and diesel prices since April 2022.
A senior government official separately told Reuters that compensating oil marketing companies while keeping fuel prices unchanged is not fiscally sustainable.
Another official said any price increase would be substantial enough to discourage spending on petrol and diesel, but not so large as to sharply stoke inflation.
Both officials spoke on condition of anonymity due to the sensitivity of the matter.
Oil minister Puri also said India has crude and liquefied natural gas sufficient for 60 days, and liquefied petroleum gas for 45 days.
Indian Prime Minister Narendra Modi urged on Sunday a spate of measures including fuel conservation, work-from-home practices and limits on travel and imports to ease pressure on the country’s foreign exchange reserves.
The country’s balance of payments is expected to worsen sharply during the current 2026-27 fiscal year, with the deficit projected at about US$66 billion (RM260 billion) to US$70 billion, up from an estimated US$26 billion to US$28 billion in 2025-26.
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