These adjustments could provide relief at petrol pumps, especially in light of the upcoming 2024 Lok Sabha elections.
State-owned oil companies are thinking about a potential move to reduce petrol and diesel prices by up to ₹10 per litre next month, aiming to ease financial pressure on drivers and address inflation concerns.
The development comes despite a projected record profit of ₹75,000 crore in the third quarter for these companies. These adjustments could provide relief at petrol pumps, especially in light of the upcoming 2024 elections.
The three government-administered oil marketing companies (OMCs), commanding a significant market share, have shown substantial net profits in the first half of the fiscal year 2023-24, marking a remarkable 4,917 per cent increase compared to the entire financial year of 2022-23.
With stable prices since April 2022, the OMCs are expected to conduct a pricing review, considering a potential reduction of ₹5 to ₹10 per litre in consultation with stakeholders, while also preparing for potential future spikes in international oil prices.
“Due to higher marketing margin on the sale of fuels, the three OMCs (oil marketing companies) posted significant net profit in Q1 and Q2 [of FY2023-24] and the trend will continue in Q3. After results by the end of this month, they may consider reducing petrol and diesel rates between ₹5 and ₹10 a litre, keeping some cushion for the future spike in international oil prices. A decision will be taken by the companies in consultations with their stakeholders," a source told Hindustan Times.
Hindustan Petroleum Corporation Ltd (HPCL) and Bharat Petroleum Corporation (BPCL) have reported notable profits in recent quarters, attributing success to low crude prices and higher gross refining margin (GRM).
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