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ONGC shares fell by over 6 per cent in the early trade on the BSE today amid media reports that the government has increased upstream oil companies’ contribution toward fuel marketing firms’ subsidy burden to 38.5 per cent of the Rs 77,922-crore estimate for FY’11.
Following the reports, Oil and Natural Gas Corporation (ONGC) fell by 6.1 per cent to touch a one-month low of Rs 279.35 on the Bombay Stock Exchange. On the National Stock Exchange, the stock slipped by 5.97 per cent to touch an early low of Rs 279.20 apiece.
According to media reports, upstream oil exploration companies will have to contribute Rs 30,000 crore to help compensate downstream fuel retailers for their subsidy burden in FY’11.
Other oil firms like Oil India and GAIL (India) were also trading under pressure. Oil India fell by 1.41 per cent to Rs 336.15, while GAIL went down by 2.36 per cent to Rs 440 in the early trade.
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