Shares of state-owned oil marketing companies pared their intra-day gains and closed in the red after Petroleum Minister S Jaipal Reddy declined reports that there would not be any immediate price rise for oil products, including petrol.
On the Bombay Stock Exchange, stocks of Hindustan Petroleum Corporation Ltd closed 1.94 per cent down at Rs 302.90 after hitting an intra-day high of Rs 314 in Friday’s trade. Meanwhile, its peer company Bharat Petroleum Corporation Ltd (BPCL), too, lost a little less than one percentage point to trade last at Rs 344.8 after it hit the day’s high of Rs 356. The fall came on a day when benchmark indices jumped close to two per cent as the 30-share Sensex climbed 337 points to close at 17,683.73.
“There are no immediate proposals to raise prices of various oil products, including petrol,” Reddy said. He, however, added that difficult and painful decisions need to be taken to reduce the under-recoveries of oil marketing companies. Reddy said that as a minister it is his duty to bring out the facts in front of the Cabinet Committee of Political Affairs (CCPA), but when the CCPA will take a final call on the issue is not known.
Indian Oil Corporation (IOC) was the only oil marketer which ended flat on the bourses at Rs 247.6, up 0.12 per cent. During the day’s trade, IOC shares touched Rs 252.40 before the fall. There are indications, however, that the government may raise petrol, diesel, cooking gas and kerosene prices simultaneously as early as next week, with Reddy saying that ‘difficult and painful’ decisions need to be taken. With oil firms losing Rs 560 crore per day on sale of regulated diesel and cooking fuels, the oil ministry is pushing for raising rates.