OMC’s Fuel Losses Decline; Petrol Under Recovery Dips to ₹3/Litre

Recent easing in international crude oil prices likely to improve the economics of petrol and diesel sales for India's state-run Oil Marketing Companies (OMCs).  

While losses on transportation fuels have moderated, domestic LPG continues to generate substantial under-recoveries despite the correction in global energy prices. 

Petrol and Diesel Under-Recoveries Decline 

As per news reports, Data shared by the Ministry of Petroleum and Natural Gas showed that, as of June 15, 2026, public sector OMCs were incurring an under-recovery of ₹3 per litre on petrol, down from ₹6 per litre recorded a week earlier. 

Diesel under-recoveries also improved, falling to ₹27 per litre from ₹30 per litre on June 8. However, losses on domestic LPG sales remained significantly higher at around ₹700 per 14.2 kg cylinder. 

Lower Crude Prices Provide Relief 

The improvement followed a decline in global oil prices after the news regarding the peace agreement between the United States and Iran.  

Benchmark Brent crude fell about 5% to around $82 per barrel on June 15, 2026, raising expectations of smoother energy shipments through the Strait of Hormuz. 

Commenting on the development, Sujata Sharma, Joint Secretary at the Ministry of Petroleum and Natural Gas, said, “If the peace deal between the US and Iran follows through, India's energy supplies through the troubled waters are expected to improve.” 

Earlier Fuel Price Revisions and OMC Losses 

Before the recent easing in crude prices, state-run retailers had increased petrol prices by ₹7.38 per litre and diesel prices by ₹7.52 per litre from May 15, marking the first fuel price increase in 4 years. 

In May, public sector OMCs were reportedly absorbing combined under-recoveries of nearly ₹1,000 crore per day across petrol, diesel and LPG sales amid elevated global oil prices. 

Diesel Advisory and Consumption Trends 

The government also reasserted its advisory asking industrial and commercial consumers not to purchase diesel through retail outlets because of a price gap of nearly ₹40 per litre between retail and bulk diesel supplies. 

Reflecting changing consumption patterns, the share of bulk diesel in overall diesel usage declined to 8.3% in May 2026, compared with 12.6% in May 2025. 

Meanwhile, retail fuel prices in Delhi currently stand at ₹102.12 per litre for petrol and ₹95.20 per litre for diesel. 

Read More: IOC, BPCL, HPCL Share Prices Jump Up to 3.4% as Crude Oil Prices Falls on Strait of Hormuz Reopening Hopes! 

Conclusion 

Although falling crude oil prices have narrowed petrol and diesel under-recoveries, losses on domestic LPG sales remain elevated at around ₹700 per cylinder for state-run oil retailers.   

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