In a bid to recoup past losses, state-owned oil companies may not immediately lift the six-month freeze on daily motor fuel prices, despite an almost 30% drop in average international gasoline and diesel prices per year. compared to the June peak, Living mint reported.
International oil prices have fallen sharply over the past four weeks. As a result, there was a reduction in the prices of commercial liquefied petroleum gas, aviation turbine fuel (ATF) and windfall taxes.
Public sector Petroleum Marketing Companies (OMCs) continue to suffer financial losses.
Due to the volatility of the global oil market, they cannot afford to immediately revert to the system of daily fluctuations in the price at the pump of automotive fuels.
According to official data, the average price of Indian crude oil imports fell by around 22% to $90.71 per barrel in September, after peaking at $116.01 in June. Product prices fell even more drastically. While the average gasoline price fell 37% from $148.82 a barrel in June to $93.78 a barrel in September, diesel is down 28% from $170.92 per barrel in June to 123.36 dollars per barrel in September.
State-run OMCs including Indian Oil Corporation (IOC), Bharat Petroleum Corporation Limited (BPCL) and Hindustan Petroleum Corporation Limited (HPCL) make a margin of about Rs 3-4 per liter on the sale of gasoline , but diesel gains are still negligible, reported the livemint.
The government is likely to review the financial conditions of the JIs and take the necessary measures accordingly.
India currently imports 85% of the crude it processes, making it the world’s third largest consumer of crude oil, behind the United States and China.