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The diesel pricing dilemma and use of Furnace oil as replacement  

The diesel pricing dilemma

(Courtesy: The Hindu Business Line , New Delhi, May 07, 2012)

Everyone knows it is heavily subsidised. Yet, any talk of a price increase in diesel raises the hackles of political parties. And amidst this chaos, expensive cars and SUVs are making the most of a hugely cheap fuel.

Oil companies are losing Rs 15/litre on diesel and are terribly concerned because it is already accounting for over 50 per cent of their projected losses of over Rs 2,00,000 crore this fiscal. Kerosene and cooking gas take up the balance but diesel continues to be the biggest area of concern because its use extends to a host of applications.

The transport sector is only a part of the actual problem. Thanks to the severe power crisis in many States, generator sets have become inevitable and need to be powered by diesel. Furnace oil, used in a variety of industrial applications, has given way to diesel which is a less expensive option.

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