Top oil marketing firms facing mounting losses for selling fuel below cost, have deferred the announcement of quarterly earnings, putting pressure on the government to quickly release INR 10,000 crore as compensation.

Petroleum minister S Jaipal Reddy has urged the finance ministry to immediately compensate state run oil firms for selling diesel, cooking gas and kerosene at low, govt-set rates.

Indian Oil Corp, Hindustan Petroleum Corp and Bharat Petroleum Corp which run over 90% of India's 40,000 petrol pumps, face a combined net loss of about INR 3,000 crore in the December quarter.

IOC informed the Bombay Stock Exchange that due to unavoidable circumstances its board would not consider quarterly earnings on Tuesday as declared earlier. It said that "The same would now be considered by the board at a later date within the stipulated time period.”

Executives of HPCL also confirmed that its board would not consider quarterly earnings in its meeting scheduled later this week.

BPCL which is scheduled to announce its financial result on January 31st is still hopeful to get timely assistance from the finance ministry. A company spokesman said that "So far, we have not deferred the schedule.”

A senior government official confirmed that the oil ministry has sought a compensation from the finance ministry for the previous quarter for selling diesel, kerosene and cooking gas below cost. A official said that "We expect the finance ministry to release it (compensation) this week.”

For the current fiscal year, the finance ministry has so far agreed to reimburse only one third of the estimated revenue loss of INR 72,000 crore, or about INR 24,000 crore but oil ministry officials said this would be inadequate.

(Sourced from ET)