Three PSU OMCs rose by 0.87% to 3.29% at 10:03 IST on BSE as global crude oil prices declined.
Meanwhile, the S&P BSE Sensex was down 231.61 points or 0.85% at 27,087.95
Among PSU OMCs, HPCL (up 3.29%), BPCL (up 1.67%) and Indian Oil Corporation (up 0.87%) gained.
Brent crude futures sank further to new multi-year lows with investors weighing the possible political and economic fallout in oil-producing countries with little respite in the selling. Brent for January settlement was down 25 cents a barrel at $ 60.81 a barrel. The contract had lost 79 cents a barrel to settle at $61.06 during the previous trading session, yesterday, 15 December 2014.
Lower crude oil prices could reduce under-recoveries of PSU OMCs on domestic sale of LPG and kerosene at controlled prices. However, a weakness in rupee against the dollar will restrict the benefit of falling global crude oil prices to that extent. A weak rupee raises the cost of imports. The government has already freed pricing of petrol and diesel.
Meanwhile, Indian Oil Corporation reduced retail selling price of petrol by Rs 2 per litre at Delhi (including state levies) with corresponding decrease in other states and decrease retail selling price of diesel (retail) by Rs 2 per litre at Delhi (including state levies) with corresponding decrease in other states. The revised prices will be applicable from 16 December 2014, IOC said.
PSU OMCs review fuel prices during the middle of the month and on the last day of the month based on the average imported oil price in the preceding fortnight.
The prices of petrol and diesel were last revised downwards from 1 December 2014 by Rs 0.91 per litre and Rs 0.84 per litre respectively (including state levies at Delhi) on the back of declining international oil prices.
Since the above price changes, the international prices of both petrol and diesel have continued to be on a downtrend. The rupee-dollar exchange rate has however appreciated since the last price change. The combined impact of both these factors warrant a decrease in retail selling prices of both petrol and diesel, IOC said.
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