Petrol & diesel to subsidise LPG loss

Market Review

 While the international prices of crude oil has declined by more than a dollar a barrel in the past week, it is not certain if it will be reflected in the domestic retail prices of petrol and diesel.

 The government has come out with a scheme to share the burden of under-recoveries on account of sale of subsidised LPG and kerosene. According to the scheme, cross-subsidisation from petrol and diesel would contribute Rs 2,400 crore.

 It would safe to assume that the retail prices of the two fuel would continue to rule high to provide sufficient cushion to the marketing companies and raise the desired revenue.

 In the international market, price movement has been restricted with the traders awaiting the latest weekly US inventory figures which will help gauge the likelihood of winter stock shortages.

 The international benchmark Brent (dated) crude, which was hovering at $28.48 a barrel on October 29, moved down to $27.92 a barrel on October 31, and slid further to $27.18 a barrel on November 4.

 Jet fuel (Singapore), which was being quoted at $33.85 a barrel on October 29, moved down to $33.80 a barrel on October 31, and further slid to $33.65 a barrel on November 4.

 Prices of gas oil (Singapore) with 0.5 per cent sulphur, which were ruling at $32.23 a barrel on October 29, touched $32.33 a barrel on October 31, and moved down to $31.65 a barrel on November 4.

 Naphtha (Singapore), which was being quoted at $ 31.08 a barrel on October 29, touched $ 30.63 a barrel on October 31, and moved down to $ 30.65 a barrel on November 4.

 Prices of unleaded petrol (fob Singapore), which were ruling at $ 34.48 a barrel on October 29, moved down to $ 33.68 a barrel on October 31, and appreciated marginally to $ 33.75 a barrel on November 4.