Shares of three state-run oil marketing companies rose by 1.59% to 2.96% at 13:54 IST on BSE, reversing intraday fall in volatile trade as under-recovery on high speed diesel declined further to Rs 1.62 per litre from Rs 2.80 per litre earlier.
HPCL was up 2.96% to Rs 403.85. The stock rose 3.81% at the day's high of Rs 407.20 so far during the day. It fell 2.79% at the day's low of Rs 381.30 in early trade.
BPCL was up 2.19% to Rs 580.70. The stock rose 2.93% at the day's high of Rs 584.90 so far during the day. It fell 2.33% at the day's low of Rs 555 in early trade.
Indian Oil Corporation was up 1.59% to Rs 338.50. The stock rose 2.21% at the day's high of Rs 340.55 so far during the day. It fell 2.97% at the day's low of Rs 323.30 in early trade.
The S&P BSE Sensex was down 86.17 points, or 0.34% at 25,142.
The under-recovery on high speed diesel (HSD) applicable for second fortnight of June effective 16 June 2014 will go down to Rs 1.62 per litre. This was Rs 2.80 per litre during first fortnight of June 2014 with effect from 1 JUne 2014. In the case of PDS kerosene and domestic LPG, the under-recoveries for the second fortnight of June 2014 continues to be Rs 32.87 per litre and Rs 432.71 per cylinder respectively, as in the last fortnight, Ministry of Petroleum & Natural Gas said in a statement.
Oil Marketing Companies (OMCs), effective 16 June 2014, are now incurring combined daily under-recovery of about Rs 249 crore on the sale of diesel, PDS kerosene and domestic LPG. This is less than Rs 262 crore daily under-recoveries during previous fortnight. The under-recoveries for the financial year 2014-15 are projected to be Rs 91665 crore while the figure was Rs 139869 in the 2013-14.
Regarding daily international crude oil price of Indian Basket as published today, the price increased to $110.54 per barrel (bbl) on 13 June 2014 as against $108.52 per bbl on 12 June 2014. In rupee terms, the price of Indian Basket increased to Rs 6574.92 per bbl on 13 June 2014 as compared to Rs 6438.49 per bbl on 12 June 2014. Rupee closed weaker at Rs 59.48 per dollar on 13 June 2014 as against Rs 59.33 per dollar on 12 June 2014.
Shares of PSU OMCs had fallen in early trade today, as US crude oil futures surged as Sunni insurgents advanced in Iraq, intensifying concerns over a potential disruption to oil exports from the second-largest OPEC producer.
US crude oil futures for July delivery rose 39 cents to $107.30 a barrel in electronic trade today, 16 June 2014. Brent crude was up 48 cents to $112.94.
Higher crude oil prices will increase under-recoveries of PSU OMCs on domestic sale of diesel, LPG and kerosene at controlled prices. The government has already freed pricing of petrol.
Prime Minister Narendra Modi said on Saturday, 14 June 2014, that repairing the economy would require unpleasant decisions and tough actions, which triggered speculation that the government may raise fuel prices and or announce diesel price deregulation to reduce the government's fuel subsidy burden.
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