Oil companies face higher losses on diesel than petrol:’Latest fuel price hike will cover only 10% of losses of oil companies’

On Friday, 15 May, 2026, India’s state-owned oil companies ended a record four-year freeze on fuel prices. Facing massive financial pressure from the ongoing West Asia conflict, companies have finally raised rates to help cover their mounting losses. Latest fuel price hike will only suffice for covering 1/10th of losses incurred due to total increment in crude rates According to news agency, PTI, the increase is a 10th of the desired hike needed to account for the surge in global energy rates since the start of the West Asia conflict. To keep prices steady for the public, oil companies like IOC, BPCL, and HPCL have been “absorbing” the high cost of global oil. Oil companies absorb higher loss on diesel than petrol Industry sources said to the news agency, that the price hike is modest relative to the rise in crude prices and still leaves retailers absorbing losses estimated at ₹11 per litre on petrol and ₹39 per litre on diesel. All India Petroleum Dealers Association (AIPDA) President Ajay Bansal, said to the news agency, ANI that that the government-owned OMCs had to absorb ₹45 to ₹50 per litre loss on sale of the mobility fuel. While, the Petroleum Minister Hardeep Singh Puri had earlier said that the fuel retailers had to absorb a loss of ₹24 per litre for petrol and ₹30 per litre for diesel on sale of mobility fuel. Gap Between Cost and Selling Price (Under-Recovery) The difference between what it costs the company to supply the fuel and what you pay at the pump is called “under-recovery.” The End of a 4-Year Record Before today, fuel prices in India had not been increased for over 1,500 days (more than four years). While there was a small price cut of ₹2 in March 2024, this is the first time since 2022 that prices have actually gone up.