The government on Tuesday took state-run oil firms to task for reported shortages in fuel supplies in some parts of the country and asked them to clear the waitlist for new domestic cooking gas connections in 60 days.

Petroleum Minister Murli Deora reviewed the supply and distribution of essential petroleum products in the country at a meeting with heads of oil companies and issued instructions for ensuring adequate supplies in the coming festive season.

"LPG connections will be available on demand," Petroleum Secretary R S Pandey told reporters after the meeting.

Pandey did some hard-talking with the CEOs of oil firms who had gone slow on issuing new LPG connections and restricted auto fuel supplies in view of mounting losses, and asked Indian Oil [Get Quote], Bharat Petroleum and Hindustan Petroleum to liquidate the waitlist for new domestic gas connections in two months.

"Wait time for LPG connections will not be allowed to exceed two months," he said while also announcing opening up of a grievance cell in the this ministry to address complaints. IOC chairman Sarthak Behuria said the oil industry had taken some measures including supplying only costlier branded fuel at select petrol pumps and stopping new LPG connections to tide over huge revenue losses resulting from the government's decision not to raise petrol, diesel, LPG and kerosene prices in line with cost.

"We have 6-7 lakh (600,000-700,000) waitlist for new LPG connections and we have now placed orders to buy 10 lakh (1 million) new LPG cylinders to liquidate it," he said adding the consumers will get a choice to buy both normal and branded petrol and diesel at all retail outlets in the country.

Oil companies proposed to suspend supplies of domestic LPG cylinders to those having piped natural gas connection, a view that was accepted by the petroleum ministry.

However, their suggestion of each household kitchen having a maximum of one LPG connection did not elicit any response.

"Distribution system will be so organised that there are no shortages in days to come especially during the festive season," Pandey said.

Officials present at the meeting said that Pandey bluntly told the CEOs that they should stop blaming the government for their revenue losses and instead do some cost-cutting and improve efficiencies.

Wasteful expenditure has to be cut, Pandey is believed to have told the CEOs. The oil companies, he said, will be held accountable for the acts of their distributors.

He also asked them to do demand management and check diversion of subsidised fuel to unintended users.

Oil companies currently sell petrol at a loss of Rs 7.07 per litre, diesel at Rs 16.22, kerosene at Rs 39.55 per litre and LPG at a loss of Rs 348.89 per 14.2-kg cylinder.

IOC, BPCL [Get Quote] and HPCL [Get Quote] are together projected to lose Rs 1,84,801 crore (Rs 1,848.01 billion) in revenues on fuel sales during 2008-09.

The oil firms were asked to take steps to augment diesel supplies in view of shortages from some parts of the country.

"I would urge upon all the officers of the oil companies to ensure that these problems are addressed at the earliest and do not recur," Deora said, adding that the country's Navratna OMC's incurring losses is a matter of concern.

Pandey called for introducing a system of incentives and disincentives in the oil industry to reward performers and motivate others for higher efficiency in their operations.