The Hindu Business Line : Indian crude basket falls to $43.82/barrel

New Delhi, Nov. 24 In line with the fall in global crude prices, the Indian crude basket on Friday hit over three-year low at $43.82 a barrel. This mounted pressure on the Government to consider a downward revision in the retail selling prices of auto and cooking fuels.

A senior Petroleum Ministry official told Business Line that the Ministry is keeping a close watch and is looking at various options for price review including whether there would be any breach of model code of conduct as some States are in the elections process.

Besides, whether the softening of crude has also resulted in bringing down the heavy under recoveries incurred by the public sector oil marketing companies (OMCs) on selling cooking gas and kerosene below the cost price, also needed to be considered, the official said.

It also needed to be seen whether the profit being made by OMCs on sale of petrol and diesel recently, is at a significant level now, he said.

The Indian basket after touching a high of $142.04 a barrel on July 3 has dropped over 69 per cent. The basket has averaged $52.18 a barrel so far this month, down from October’s average of $69.12. Despite the softening, the average price of Indian basket of crude oil is still $104.47 a barrel as against an average of $79.25 a barrel in 2007-08.

Besides, the benefit of the recent softening in the international prices has been partly offset by the depreciation of rupee. The OMCs – Indian Oil Corporation, Bharat Petroleum Corporation, Hindustan Petroleum Corporation – incur revenue loss owing to non-revision of selling prices in line with the prevailing international prices.

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