Sources have told CNBC-TV18 that state-run oil marketing companies (OMCs) — Hindustan Petroleum Corporation Ltd. (HPCL), Bharat Petroleum Corporation Ltd. (BPCL), and Indian Oil Corporation Ltd. (IOC) — are expected to mop up nearly ₹9,000 crore in FY26 due to a proposed ₹50 increase in LPG cylinder prices.

According to senior government officials, the Oil Ministry is preparing to seek Cabinet approval for a ₹32,000 crore compensation package to offset ₹41,338 crore in under-recoveries suffered by OMCs in FY25 on subsidised LPG sales.

The ₹32,000 crore mop-up will likely come from the

₹2 hike in excise duty on petrol and diesel. But officials said this increase will not burden consumers, as oil companies will absorb the hike.

“Crude oil prices have softened, and current inventory averages are around $75 per barrel. With crude expected to stabilise between $60 and $65 per barrel, OMCs will have better margins,” an official said.

The official indicated that OMCs are expected to absorb the ₹2 increase in excise duty, thanks to improved margins. They said if crude oil prices remain in the $60-65 per barrel range, there could be room for a reduction in fuel prices.

Shares of India’s state-run oil marketing companies — HPCL, BPCL, and IOC — will be in focus on Tuesday, April 8, following key government announcements.

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