Indian Oil, BPCL post losses on fuel price cap
BOMBAY/NEW DELHI: Ref-iners Indian Oil Corp. Ltd. and Bharat Petroleum Corp. Ltd. posted their first ever quarterly losses on Friday, struggling due to government caps on product prices while crude prices have soared.
The Indian government has not allowed state-run refiners to raise fuel prices to match the jump in crude prices, bowing to political pressure from its communist allies.
But oil ministry officials have said India will review fuel prices if oil companies continued to report losses after a 7 percent rise in petrol and diesel on June 20. Indian Oil Corp. (IOC), India’s largest refiner, reported a net loss of 542.3 million rupees in the first quarter to June 30, compared with a profit of 14.72 billion a year ago, and officials said losses would continue unless fuel prices rose.
Bharat Petroleum (BPCL), a smaller oil refiner and marketing company, suffered a higher loss of 3 billion rupees last quarter compared with a profit of 2.73 billion a year ago. BPCL said in a statement the results had been adversely affected by high crude oil prices and “product prices which could not be fully passed on to the consumer”. Last month’s increase in administered petrol and diesel prices only partly compensated refiners for a 20 percent rise in crude costs since November, when fuel prices were last increased. reuters