OMCS profit soar; hope for fuel price cut rises

WOULD the public sector oil marketing companies (OMCs) finally bite the bullet and go for a fuel price cut, especially after churning out healthy profits for three quarters in row in FY24?

- RAKESH KUMAR

Oil marketing companies (OMCs) like Indian Oil Corporation Limited (IOCL), Bharat Petroleum Corporation Limited (BPCL), and Hindustan Petroleum Corporation Limited (HPCL) consistently churned profits over the last three quarters.

In the third quarter of FY 2023-24 alone, these companies collectively reported a profit of ₹11,774 crore. Their combined profits over the past three quarters have surpassed ₹69,000 crore, exceeding their annual earnings from pre-oil crisis years (2020-23).

The profit of these oil companies can be attributed to a recovery in fuel marketing margins and better refining margins. The decision by the oil companies to freeze petrol and diesel price revisions, despite a fall in input crude oil prices, helped in recovering losses incurred when rates were high in 2022-23. This resulted in losses when input costs were higher and profits when raw material prices were lower.