Oil marketers will lose their current retail margin of 40 paise on petrol while the loss on diesel is expected to increase by a fifth to Rs 6 per litre from next month.
The price of aviation turbine fuel is expected to increase by two per cent from next month.
Industry officials said petrol was expected to have an under-recovery of 50 paise per litre that would wipe off the current margins of 40 paise.
"Petrol will have a marginal loss of 10 paise from next month in tune with the international trend," said an industry executive. Petrol, a decontrolled product, will slip into negative territory after a month.
On diesel, a product still regulated by the government, the oil marketers -- Indian Oil, Bharat Petroleum and Hindustan Petroleum -- could see their under-recovery swell to about Rs 6 a litre from Rs 5 now.
These companies, who purchase crude oil at market rate, are required to sell diesel, kerosene and liquefied petroleum gas at government-subsidised prices, resulting in losses.
Price of the Indian basket of crude oil, that averaged $111.26 per barrel in the first fortnight of the month, has averaged $113.81