Fuel price revision: Oil companies may slash petrol, diesel prices by Rs 5-10 in Feb ahead of LS polls

State-owned Indian Oil Corporation (IOC), Bharat Petroleum Corporation Ltd (BPCL), and Hindustan Petroleum Corporation Ltd (HPCL) may slash petrol and diesel prices in February ahead of the Lok Sabha elections. The state-run oil companies have suspended the daily price revision of petrol and diesel since last year. The companies will take a call after they release their Q3 FY24 results this month, sources told Hindustan Times.

Till Q2 FY24, the combined net profit of the three firms was Rs 57,091.87 crore, which was over 4,917 per cent increase from Rs 1,137.89 combined net profit for FY2022-23. The companies are expected to report a net profit of Rs 75,000 crore at the end of Q3 FY24 despite the dwindling crude oil prices in the global market.

The move could help ease inflation, which has become a concern for the government and the Reserve Bank of India. Also, it can be a significant move ahead of the 2024 General Elections scheduled in April-May.

“Due to higher marketing margin on sale of fuels, the three OMCs posted significant net profit in Q1 and Q2 and the trend will continue in Q3. After results by the end of this month, they may consider reducing petrol and diesel rates between Rs 5 and Rs 10 a litre, keeping some cushion for future spike in international oil prices. A decision will be taken by the companies in consultations with their stakeholders,” an official told HT.

Hindustan Petroleum Corporation Ltd (HPCL) has announced that it will release its Q3 results on January 27. Indian Oil Corporation (IOC) and Bharat Petroleum Corporation Ltd (BPCL) are also anticipated to make announcements during the same time.

India, the world's third-largest oil importer and consumer, relies on imports for over 80 per cent of its oil requirements.

The OMCs dominate the domestic fuel retail business, holding a market share of over 90% and exerting significant influence over the pricing of private retailers.

The last nationwide fuel price revision took place on May 21, 2022, when Finance Minister Nirmala Sitharaman reduced the excise duty on petrol by Rs 8 per litre and on diesel by Rs 6 per litre.

For more than a year, the price of petrol in Delhi has been Rs 96.72 per liter, while diesel is being sold at Rs 89.62 per litre.

In Mumbai, petrol is available for Rs 106.31 per liter, with diesel is being sold for Rs 94.27 per litre.

In Kolkata, the cost of petrol amounts to Rs 106.31 per liter, while diesel is priced at Rs 92.76 per liter. In Chennai, petrol is available at Rs 102.63 per liter, while diesel can be obtained at Rs 94.24 per liter.