Disaster math

There can be questions about the timing of buying crude and processing costs,but these are managerial calls that have to be taken keeping in mind the changes in the world oil market. There is another side to the story. In the same period,Reliance Industries managed to improve its gross refining margin since most of its products from its Jamnagar refinery are exported.

What has remained the same is the way the government makes conditions worse for public-sector oil marketing companies by keeping the oil subsidy regime intact. In two days,the three largest state-run companies have presented the government with an uncleared bill of Rs 32,765 crore for their under recovery. They ran up the losses by selling kerosene,LPG and diesel at prices set by the oil ministry. Since the government has set aside about Rs 30,000 crore for oil subsidy in this budget,which will be exhausted paying last years bill,it will be a long wait for these companies again. Meanwhile,the aggregate loss of the companies has reached Rs 40,540 crore in this quarter,a fourfold jump from previous year.