Indian Oil Corp losing Rs1.15 billion per day on fuel sales

State-run Indian Oil Corp (IOC), the country's biggest oil retailer, is currently incurring a daily revenue loss of Rs1.15 billion ($24.9 million) on fuel sales in the domestic market, its chairman told reporters on Wednesday.

BM Bansal said petrol prices are currently Rs3.2 per litre below desired market prices, while diesel prices need to be raised by Rs3.4 a litre.

He said a panel of ministers, which would meet on Friday, was expected to take a decision on the recommendations of a government committee that favoured deregulation of gasoline and diesel prices.

It would be a tough test of the government's appetite for reforms in the face of high prices. A decontrol could help state-run oil firms and bolster India's fiscal health because fuel accounts for a quarter of its estimated subsidy bill of $25.6 billion.

Bansal said he expected the ministerial panel on fuel pricing to lift government control over the retail prices.

He said his company was thinking of raising Rs80 billion through share sales, if the share price cross Rs400 a share. IOC shares were trading up 1% at Rs345.50 at 1.25pm (0755 GMT).

"For raising money through share sales, we need to have four more independent directors on our board... we need money for our various projects," Bansal said.

The panel had on June 7 deferred a decision to ease government control over fuel pricing because of political pressure over high prices.