The PSU oil marketing companies (OMCs) are facing a daily loss of around ₹600-700 crore on an industry basis due to the volatility in crude oil prices on account of the West Asian conflict, which has intensified further with Iran attacking Israel on Sunday.
Pravin Mal Khanuja, Additional Secretary in the Ministry of Petroleum & Natural Gas (MoPNG), said the under-recovery on petrol currently is ₹ 6 per litre and that on diesel is ₹ 30 a litre. Besides, on an industry basis, the PSU OMCs are losing around ₹600-700 crore per day on a cumulative basis.
“All refineries are operating at high capacity with adequate crude inventories, while sufficient stocks of petrol and diesel are being maintained. All retail outlets are operating normally across the country,” the senior Oil Ministry official emphasised.
To manage losses, the PSU OMCs have already raised petrol and diesel prices by roughly ₹7.50 a litre each in four instalments. CNG prices were also revised upwards by ₹6 per kg.
On the brighter side, about 9.16 lakh piped natural gas (PNG) connections have been gasified since March 1 and infrastructure has been created for additional 3.05 lakh connections, taking the total to 12.21 lakh connections, Khanuja said.
Besides, about 9.24 lakh customers have been registered for new connections. Further, 82,000 PNG consumers have surrendered their LPG connections till June 7, 2026. Refineries supplied 2,760 tonnes of C3/C4 molecules and 1,660 tonnes of butyl electrolyte since June 1 for chemicals and pharma, he added.
Despite the ongoing situation in West Asia, supplies of crude oil, LPG and natural gas remain stable. India has adequate stocks of petrol, diesel and LPG available in the country, he assured.
LPG production
Khanuja said that domestic LPG production has been maximised with domestic refineries and fractionators continuing to produce about 52-53 thousand tonnes per day (TPD), about 60 per cent higher than pre-crisis levels.
“There have been no reports of dry-out at LPG distributorships. LPG delivery backlogs have been reduced to less than four days, while 99 per cent of LPG cylinder bookings are now made online. The Delivery Authentication Code (DAC) compliance rate stands at around 96 per cent” he added.
It is expected that OMC losses may increase further after Iran’s attack on Israel on Sunday, which has again pushed up crude oil prices. On Monday evening, Brent stood at $94.78 a barrel and WTI was trading at $91.88 per barrel.
Norbert Rücker, Head Economics and Next Generation Research at Julius Baer, said the hot-headed politics in West Asia keeps the oil market nervous. With the latest exchange of hostilities between Israel and Iran, the broader conflict’s power balance and resolution are once again on the testbed.
“Diplomacy remains in gridlock and could falter, not least given the latest events and the challenges they bring to the US-Israel alliance. That said, a full-scale escalation has remained absent so far, and looking ahead, these chances incrementally diminish over time. While we are keeping a close eye on the current situation, we stick to our cautious view on oil. Trade through Hormuz should continue to expand gradually as pragmatism and opportunism prevail,” he added.