Falling rupee bleeds OMCs of Rs 9,200 cr every year

A loss of 100 paise in rupee's value against the US dollar in a year costs oil marketing companies Rs 9,200 crore per annum, the government said on Friday.

Oil marketing companies (OMCs) incur losses due to depreciation of rupee against dollar, minister of state for finance Namo Narain Meena said in a written reply in the Lok Sabha.

"The estimated impact of increase in rupee-US dollar exchange rate by Re 1 on under recovery of sensitive products - diesel, PDS kerosene and domestic LPG - is Rs 9,200 crore annually," he said.

Explaining the details, he said the impact of depreciation of rupee by 100 paise on per litre of diesel, kerosene and LPG is Rs 0.87, Rs 0.85 and Rs 14.51, respectively.

The estimated impact on annual basis is Rs 6,850 crore, Rs 850 crore and Rs 1,500 crore on diesel, kerosene and LPG, respectively. Indian Oil Corp, Bharat Petroleum Corp and Hindustan Petroleum Corp together lost Rs 148,231 crore on selling diesel, domestic LPG and kerosene at rates lower than cost in 2011-12.

The rupee has been witnessing sharp volatility in recent times. It plunged to a new low of 54.90 against dollar in early trade today, before settling at 54.42.