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PSU oil cos' profits up; price cuts likely

Source: PTI
December 31, 2008 17:20 IST
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Public sector oil firms have seen their profits on petrol widen to about Rs 12 a litre and that on diesel to Rs 4 per litre, strengthening the case for a fuel price cut next month.

Indian Oil, Bharat Petroleum and Hindustan Petroleum recorded profit on the sale of petrol and diesel, the first in three years, on the back of falling international oil prices, industry sources said.

The three firms are moping up a neat Rs 11.99 per litre margin on petrol and Rs 4.13 a litre on diesel sale.

They, however, continue to lose Rs 12.16 on the sale of every litre of kerosene through public distribution system and Rs 132.97 per 14.2 kg domestic LPG cylinder.

Sources said, the position on fuel prices is likely to be put before the Cabinet soon for a decision on reducing petrol and diesel prices.

Oil firms revise prices twice a month -- on the 1st and the 16th of every month based on the average imported price for the preceding fortnight. But the revised prices are not passed on to consumer as Government administers retail rates.

The fall in international oil prices will result in lower revenue loss on fuel sales this fiscal.

IOC, BPCL and HPCL will end the 2008-09 fiscal with just over Rs 10,000-crore (Rs 100-billion) revenue loss, Rs 92,853 crore (Rs 928.53 billion) of which has already been accounted for in the first half of the fiscal.

Sources said after the December 6 price reduction, public sector oil firms were making a profit of Rs 9.98 on sale of every liter of petrol and Rs 1.03 per liter on diesel.

The further softening in global oil prices saw these profits widen to Rs 11.48 per liter on petrol and Rs 2.92 a liter on diesel last fortnight.

It has widened further, they said.

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