The Hindu Business Line : Indian crude basket falls below $50/bbl

The Indian crude oil basket hit a new low in the current fiscal on January 17, falling to $49.85 a barrel on Wednesday, a dip of almost 75 cents from the previous day. This was for the first time since April 2006 that the Indian basket fell below $50 per barrel.

The basket comprises Oman-Dubai sour grade crude and Brent dated sweet crude in 58:42 ratio.

On Wednesday, Brent closed at $50.68, down 18 cents from Tuesday. The Dubai benchmark was down to $49.09 while Oman fell to $49.50.

Asked about the dip in crude basket and whether the Government could consider any revision in product prices, the Petroleum Minister, Mr Murli Deora, said: "It needs to stabilise for over a month."

With the softening of crude prices, the Government had said that it was likely to review retail prices of petrol and diesel at the end of the current month.

After touching a high of $75.20 in August 2006, the basket touched the lowest on Wednesday.

Though the crude price for the date (January 17) dipped by 75 cents, the January till date average for the current quarter stood at $52.50.

The average for the previous quarter stood at $58.43.

The April till date average stood at $63.73, while the average for December was $60.35.

According to analysts, with not much likelihood of an emergency meeting of the OPEC on crude output cut, prices have started declining.

They were quick to point out that it needs to be seen how the prices stabilise.

A certain section of experts are of the opinion that the Indian basket could bounce back in the range of $55.

Meanwhile, the State-owned oil marketing companies have started making a combined profit on petrol and diesel but cooking gas and kerosene continue to be a matter of concern.

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