PSU OMCs gain as crude continues to slide

Three public sector oil marketing companies rose by 1.13% to 2.41% at 13:50 IST on BSE as crude oil prices tumbled for a seventh straight session on Thursday, 18 April 2013.

HPCL (up 2.41%), BPCL (up 1.65%) and Indian Oil Corporation (up 1.13%), edged higher.

The BSE Sensex was up 160.88 points, or 0.86% at 18,892.04.

US crude oil futures for May 2013 delivery were down 0.16%, or 0.14 cents at $86.70 a barrel in the electronic trading today, 18 April 2013.

Lower crude oil prices will reduce under-recovery of public sector oil marketing companies (PSU OMCs) on domestic sale of diesel, LPG and kerosene at government controlled prices. In January 2013, the government allowed PSU OMCs to raise diesel prices in small measures at regular intervals while completely deregulating diesel prices sold to institutional or bulk buyers.

PSU OMCs announced cut in petrol price by Re 1 per litre, excluding value added tax (VAT), effective midnight Monday, 15 April 2013, because of fall in international oil prices. The recent cut in petrol price comes on the back of 85 paise a litre reduction in rates on 2 April 2013 and Rs 2 a litre decrease effected on 16 March 2013.

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