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Indian state refiners narrow LPG losses in August
Losses per household LPG cylinder fell to $1.97, down from $5.25 in July, after government compensation for retailers continued with a lag.
Big Indian state-controlled refiners have been seeing smaller losses on retail liquefied petroleum gas, or LPG, sales so far in August, an Indian energy ministry official told Parliament, according to OilPrice citing a written reply carried by Reuters.
Indian Oil Corporation, Bharat Petroleum Corporation, and Hindustan Petroleum have narrowed their LPG retail losses nearly threefold in August compared with July. The revenue loss is now $1.97, or 188 Indian rupees, per one household cylinder, down from $5.25, or 500 rupees, in July.
The Indian government compensates fuel retailers for LPG sales losses, but the compensation comes with a lag and is paid at below market rates. OilPrice notes that the country has been scrambling for LPG supplies since the war in Iran and the closure of the Strait of Hormuz, which disrupted shorter routes.
India has boosted imports of oil and LPG from suppliers that do not rely on the Strait of Hormuz, though costs are usually higher and shipping times are longer. In April, India urged local refiners to increase LPG production to address the supply crunch.