The Hindu Business Line : BPCL chief does not foresee petro price hike

AT a time when consumers are apprehensive of a steep hike in petroleum prices after the elections, the chief of Bharat Petroleum Corporation Ltd (BPCL), the country's second largest oil marketing company, has indicated that the better refining margins and softer crude prices may keep the prices of petro-products in check.

"This year, the refining margins have been better than last year. So we have been able to absorb the spurt in crude prices in the last few months. Crude prices always soften during summers as energy requirements go down. That might help us to maintain the prices at the current levels," the BPCL Chairman and Managing Director, Mr S. Behuria, told newspersons on the sidelines of a seminar organised by the Indian Institute of Petroleum (IIP) here on Tuesday.

On BPCL's expansion plans, Mr Behuria said that the State-run company plans to invest Rs 500 crore for adding 700 petrol stations in 2004-05 to take its retail strength to 6,000 outlets. "We added close to 700 petrol pumps in 2003-04 and plan to do a similar number this fiscal," he said.

Besides BPCL, Indian Oil Corporation Ltd and Hindustan Petroleum Corporation Ltd together plan to add 2,200 pumps this year to take the total number of petrol stations in the country to 26,000.

Private sector Essar Oil is also planning to set up about 600 retail petroleum outlets during the current year, the company's Chief Executive Officer and Managing Director, Mr A.N. Sinha, said.

The number of petrol outlets has risen from 18,800 as on March 31, 2003 to 22,950 by March 31, 2004.

Mr Behuria said such large-scale opening of new outlets would affect the economics of petrol pumps.

"The average throughput per petrol pump has come down from 200 kilolitres per month to 165 kilolitres per month.

As we add more and more outlets, some, particularly the old ones, may become uneconomical and may need to be closed down," he said.

On high octane fuels that have hit the markets in the last two years, Mr Behuria said that the company's `Speed' brand was growing at the rate of 60 per cent and accounted for 10 per cent of BPCL's total sale of petrol in 2003-04.

In metropolitan cities, the demand was much higher and the premium petrol accounted for 30 per cent of the sales, he said.