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The decision not to raise retail prices of petrol and diesel by the oil marketing companies (OMCs) was a “conscious” and “calibrated” decision with the interest of the common man in view, state-run Indian Oil Corporation (IOC) Chairman Shrikant Madhav Vaidya said on Thursday.
“As a good corporate citizen, all (every) time, we may not see profits come into the company. The government has a holding in the company. It was a conscious deliberate calibrated decision not to increase the prices,” Vaidya said.
OMCs have to revise petrol and diesel prices daily to align with international prices. However, IOC, Bharat Petroleum Corporation (BPCL) and Hindustan Petroleum Corporation (HPCL) have kept prices on hold. After no revision for more than four months, OMCs began the daily revision in March with the freeze coming back again in April.
At present, the retail prices of petrol is ₹96.72 per litre, while diesel is priced at ₹89.62 a litre in Delhi.
High oil and gas prices
When asked about the record high prices of natural gas, Vaidya said, “I agree prices are going through the roof. But, I firmly believe this is not sustainable. It will come down.”
As an alternative to deal with such volatility, he pointed out that one cannot replace natural gas that comes from abroad as LNG, but one cansupplement the energy policy.
Also read:IOC to invest over ₹2-lakh crore to become net zero emitter by 2046
“So that is why we have more and more increasingly putting emphasis on biofuels as that would be one way to reduce the import dependence,” he noted.
On the crude oil scenario, the IOC chief said, “Now we see some softening of prices, because as I said, given the gas prices whatever was there, it is simply not sustainable. It will only push us into a recession- not only us, but globally. So I think we are seeing some softening of the trends. Let’s hope things normalise. Oil and gas is something that nobody can predict.”
Under recoveries
“OMCs have incurred a cumulative loss (before tax) for the first quarter of FY23 amounting to ₹23,799 crore, as against a profit before tax of ₹14,642 crore in the fourth quarter of FY22. This loss is on account of under-recoveries in petrol, diesel and LPG,” the Ministry of Petroleum and Natural Gas (MoPNG) said.
However, with international crude oil prices cooling down gradually, the under-recoveries are expected to decline.
During July 2022, the price of Indian Basket of crude oil varied between $99.76 per barrel and $112.42, with the average price as $105.49 per barrel, which is 9.07 per cent lower than the average price of $116.01 per barrel in June 2022.
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