Healthy marketing margins on auto fuels could spur price reductions of Rs 2-3 per litre in petrol and diesel prices in the country if crude prices remain stable, leading rating agency ICRA said on Thursday.
The marketing margins on retail sales of auto fuels for the Indian oil marketing companies (OMCs) have improved in recent weeks with the reduction in crude prices.
The rating agency anticipates that there is headroom for the downward revision of retail fuel prices if crude prices remain stable at current levels. The outlook for the refining and marketing sector remains stable.
"ICRA estimates that the OMCs' net realisation was higher by Rs 15/litre for petrol and Rs 12/litre for diesel compared to international product prices in September 2024 (till September 17)," said Girishkumar Kadam, SVP and Group Head - Corporate Ratings, ICRA.
Another leading rating agency CLSA said on Wednesday that petrol and diesel prices may be reduced after October 5.
According to ICRA, the retail selling price (RSPs) of these fuels have been unchanged since March 2024 (Rs 2/litre was reduced on petrol and diesel on March 15) and there appears to be headroom for their downward revision by Rs 2-3/litre, if crude prices remain stable, he added.
Crude prices have witnessed a sharp decline in the last few months, primarily due to weak global economic growth and high US production and the OPEC+ has pushed the rollback of its production cuts by two months to combat the declining prices.
The impact is mainly on account of weak demand from China due to rising electric vehicle (EV) sales, muted industry demand and real estate downturn.
Further, demand in Europe has also been subdued due to weak industrial activity and a structural shift in vehicle fleets towards EVs.
As per the report, a marketing gain of Rs 1/litre on petrol and diesel would compensate for the gross refining margin (GRM) loss of 0.9 $/barrel for the domestic refining and marketing industry.
Petroleum, oil and lubricants (POL) consumption in India witnessed YoY growth of 5 per cent in FY24 and is likely to witness a 3-4 per cent growth in FY25, driven by economic progress, increasing mobility and air travel.
The OMCs have planned a significant capex in the refining segment. The domestic refining capacity is expected to increase to 306 million MT over the next three to four years from the current capacity of 256.8 million MT as of March 2024 to support the increased consumption and exports.
Tripura Govt contemplating to boost tourism: Minister Sushanta Chowdhury
The state transport and tourism minister Sushanta Chowdhury on Thursday said that the government is contemplating to make tourism as an alternate means of livelihood in the state. Adequate fund has been allocated for further developing the tourism sector, he added.
Imports from B’desh to Tripura increase, exports largely decline: Minister
Imports from Bangladesh into Tripura increased but exports from the northeastern state of India to the neighbouring country substantially declined, state Industries and Commerce Minister Santana Chakma told the Assembly on Thursday.
67 percent households in AMC areas connected with drinking water supply: CM Dr Manik Saha
Chief Minister Dr Manik Saha on Thursday claimed that at least 67% households were connected with drinking water supply in the areas of Agartala Municipal Corporation.
Boy drowns in Muhuri River during Baruni bathing ritual
In a tragic incident, Sayan Pal (18), a 12th-standard student from Arya Colony, Belonia, drowned in the Muhuri River while participating in the holy Baruni bathing ritual on Wednesday afternoon.
Innovative projects launched to supply drinking water from Dumbur: CM
Chief Minister Prof. Dr. Manik Saha today said that several innovative projects have been set up based on the reserved water of the Dumbur water reservoir, making it possible to provide drinking water connections to many families through pipelines.
Govt undertaken measures to increase Howrah river’s navigability: Tripura CM
Chief Minister Prof. Dr. Manik Saha today said that the state government has undertaken a series of measures to permanently address flooding in Agartala city by increasing the navigability of the Howrah River.
Tripura Assembly witnesses spat over minister's 'racist' remark against LoP
The Tripura Assembly witnessed a noisy scene for the fourth day on Thursday over Parliamentary Affairs Minister Ratan Lal Nath's alleged racist remarks against Leader of the Opposition (LoP) Jitendra Chaudhury.
Centre Releases Rs 240.5 Crore to Tripura for Urban Planning Reforms
Chief Minister Prof. Dr. Manik Saha today announced that the Ministry of Finance has released Rs 240.5 crores to Tripura for achieving urban planning reforms.