Shares of state-owned oil marketing companies (OMC) are trading higher by 2%, extending their three-day rally after Brent crude oil prices plunged to 18-month low and amid hopes of partial de-regulation of diesel prices.
Hindustan Petroleum Corporation Limited (HPCL) has moved higher by 4% to Rs 334, extending its 7.4% rally in past three days on the Bombay Stock Exchange. Bharat Petroleum Corporation Limited (BPCL) and Indian Oil Corporation (IOC) too, surged 5-8%, compared to 0.50% fall in the benchmark Sensex.
Crude oil accounts for about 95% of the cost of producing petroleum products as a result of which the oil companies start piling up losses the moment imports turn costlier.
“Brent crude for August delivery fell 56 cents to $92.13 a barrel by 0254 GMT, after falling to as low as $91.98, its weakest since December 20, 2010. Front-month U.S. crude was down $1.11 cents to $80.34 a barrel, after earlier hitting an eight-month low of $80.39,” the Reuters report suggests.
Meanwhile, India’s chief economist advisor Kaushik Basu in an interview hinted that a report on deregulation of diesel prices was likely to be finalised by next week.
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