Populism to squeeze OMC cos

Oil marketing companies such as Indian Oil, HPCL and BPCL will come under pressure this week, as the Government has announced an increase in the cap of subsidised liquefied petroleum gas (LPG) cylinders to 12 a year. With this, 99 per cent of LPG consumers will be eligible for subsidy on all refills. The move will increase under-recovery figures by Rs 3,600 crore. Oil marketing companies reported total under-recoveries of Rs 60,907 crore for the first half of 2013-14. Officials say only one per cent consume more than 12 cylinders a year.