Friday, February 24 2006 10:43 Hrs (IST) - World Time -

New Delhi: In a major move to provide relief to oil marketing companies, the Government yesterday(Feb 23,2006) decided to issue bonds amounting to Rs 100.5 billion to them to partly offset their losses arising out of differences between domestic and rising international petroleum prices.

"The cabinet took the decision to issue the bonds to mitigate the losses of oil marketing companies due to mismatch between retail prices of petroleum products and the global prices of crude," Information and Broadcasting Minister Priyaranjan Dasmunshi told reporters.

The bonds will be issued in two equal tranches of Rs 50.75 billion.

"The first tranche of bonds will be issued immediately and the second will be issued shortly thereafter," he said.

The oil companies have for long been demanding that their losses be compensated by either through price hike or bonds.