Drop In Dubai Crude Prices May Rein In Oil Pool Deficit

The softening of Dubai crude and high speed diesel (HSD) prices has provided the petroleum and natural gas ministry a much-needed breather on the face of mounting oil pool account deficit.

In case Dubai crude prices continue to rule at the current level of around $17 a barrel for another month, the ministry is hopeful of containing the deficit within Rs 15,000-15,500 crore by March 31.

Since HSD accounts for 45 per cent of the total consumption of petroleum products, the easing of diesel prices from the current years high of $230 a tonne to around $200 a tonne has brought added cheers to the ministry. The ministry was apprehensive that the oil pool account deficit might overshoot the earlier estimates of Rs 15,500 crore in case Dubai crude prices continue to rule at the six years high of around $23 a barrel. While drawing up the oil economy budget, the Oil Coordination Committee (OCC), which administers the oil pool account, had taken Dubai crude at $19 a barrel.