Indian Oil Corporation (IOC) (down 1.36% to Rs 294.80), Hindustan Petroleum Corporation (HPCL) (down 1.83% to Rs 340.15) and Bharat Petroleum Corporation (BPCL) (down 0.63% to Rs 515.10), edged lower.

Meanwhile, the BSE Sensex was down 12.88 points, or 0.08% to 17,037.77

Crude oil rose as much as 0.9% to $79.85 a barrel in Asian electronic trading on Wednesday, 18 November 2009, after the American Petroleum Institute said on Tuesday crude inventories fell by 4.37 million barrels last week to 333.1 million. On the New York Mercantile Exchange, December crude settled 24 cents, or 0.3%, at $79.14 a barrel, on Tuesday, 17 November 2009

Rise crude oil prices will increase under-recoveries of state-run oil marketing firms (OMCs) on domestic sale of petrol, diesel, LPG and kerosene at a controlled price. With international crude prices at $79 per barrel, state run oil marketing firms are losing Rs 3.85 per litre on petrol, Rs 3.71 a litre on diesel. They are losing Rs 16.34 per litre on kerosene sold through public distribution scheme and Rs 201.88 per 14.2 kilogram domestic LPG cylinder.

As per reports, the combined revenue losses for IOC, BPCL and HPCL are projected at Rs 45,160 crore in the year ended March 2010. The combined under-recoveries of the three OMCs worked out to more than Rs 100,000 crore in the year ended March 2009. The government had issued oil bonds worth Rs 71,292 crore to help these companies to cover up for their under-realisation. But the government is yet to compensate OMC's for losses in the current financial year.

Reports early this month indicated the Petroleum Ministry has sought oil bonds worth Rs 11,853 crore for state-run fuel retailers to make up for the losses they incurred on selling domestic LPG and kerosene below cost during the first half of the current fiscal. IOC, BPCL and HPCL lost Rs 15,856 crore in revenues on selling petrol, diesel, domestic LPG and kerosene below cost during the first half of the current fiscal. IOC is to get oil bonds worth Rs 7,136 crore, HPCL Rs 2,443 crore and BPCL Rs 2,274 crore, reports added.

On 15 November 2009, state-owned oil marketing firms hiked jet fuel prices, for the second time this month, by 2.4% following a spurt in crude oil prices. The latest price hike comes on the back of an over 9% hike in jet fuel prices on 1 November 2009.

The three state run oil marketing companies (OMCs) revise jet fuel prices on the first and the 16th day of every month based on the average global oil price in the previous fortnight.

In July 2009, the government had unexpectedly increased the price of petrol by Rs 4 a litre and diesel by Rs 2 a litre. It was the first increase in 2009, following a rise in the international price of crude oil and the increasing under-recovery of state-run oil marketing companies (OMCs) on domestic fuel sales at a control price.