29, February, 2024
HomeBusinessExpect Petrol and Diesel Prices to Drop by up to Rs 10 as Oil Companies Report Strong Q3 Earnings

Expect Petrol and Diesel Prices to Drop by up to Rs 10 as Oil Companies Report Strong Q3 Earnings

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Oil marketing companies (OMCs) in India are poised to bring relief to consumers by potentially reducing petrol and diesel prices by Rs 5 to Rs 10 next month. This move follows robust Q1 and Q2 performances in the fiscal year 2023-24, with expectations of continued success in Q3.

Read Also | Petrol and Diesel Prices for January 2 Across Indian Cities

The anticipated price cuts are attributed to the OMCs’ record-breaking combined net profit, exceeding Rs 75,000 crore, driven by lower crude oil acquisition costs.

Key Highlights:

  • Profit Surge: Government-owned fuel retailers, including Indian Oil Corporation Ltd (IOCL), Bharat Petroleum Corporation Ltd (BPCL), and Hindustan Petroleum Corporation Ltd (HPCL), controlling around 90% of the market, have witnessed a remarkable jump in combined net profit. In H1 FY2023-24, the net profit reached Rs 57,091.87 crore, showcasing a remarkable increase of over 4,917% compared to the entire fiscal year 2022-23.
  • Price Freeze History: Petrol and diesel prices have remained frozen for an unprecedented 21 consecutive months, but OMCs are now considering passing on the benefit to consumers.
  • Marketing Margin Windfall: OMCs currently hold a substantial margin of Rs 10 per litre, a potential reduction that could be transferred to consumers, offering much-needed relief at the pump.
  • Future Considerations: The decision to cut prices will be made post the announcement of Q3 results, balancing the reduction with a precautionary cushion for potential spikes in international oil prices.
  • Financial Result Declarations: HPCL is scheduled to declare its Q3 financial results on January 27, with BPCL and IOC expected to follow suit around the same time.

As consumers eagerly await a potential decrease in fuel prices, the OMCs’ strong financial performance sets the stage for positive changes in the coming month.

Read Also | Infosys Shares Soar Over 7% on Solid Q3 Earnings: A Smart Move for Investors?

Stay tuned for updates after the Q3 results are unveiled by the end of this month.

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