Union Petroleum Minister Hardeep Singh Puri has said that oil marketing companies incurred losses of Rs 74,781 crore by selling petrol, diesel, and LPG below cost for the period up to June 30 when global crude oil prices spiked in the wake of the West Asia conflict.
Puri stated international crude oil prices have come down but companies are still processing crude they bought at the height of the West Asia crisis. Oil companies typically buy crude oil -- the raw material for producing fuel -- at least two months in advance. So, crude oil that is being processed now is essentially what was bought in April or early May when international prices were very high.
Talking about the possibility of lowering petrol and diesel prices, Puri said this would be a legitimate question if oil prices stayed low for the next few weeks. Crude oil prices started coming down only in the second half of June following an agreement between the US and Iran to end the conflict.
