16 June 2009;dailypioneer.com:New Delhi: State-run oil firms on Monday hiked jet fuel or ATF rates by over 12 per cent on firming international oil prices. Indian Oil, Bharat Petroleum and Hindustan Petroleum raised aviation turbine fuel (ATF) price by Rs 3,949 to Rs 36,252 per kilolitre in Delhi effective midnight, an IOC official said. In Mumbai the rate will go up from Rs 33, 260.8 per kl to Rs 37,367 per kl.
Oil ministry pitches for deregulation of fuel prices
16 June 2009;deccanherald.com:Aditya Raj Das:New Delhi: In the face of the ongoing rise in global crude oil prices, the petroleum ministry on Monday pitched for deregulation of fuel prices by allowing state-owned oil marketing firms to determine the retail prices for auto fuel at par with international market prices. This and other issues figured at an hour-long pre-budget meeting Petroleum Minister Murli Deora had with the Finance Minister Pranab Mukherjee here. Considering the political sensitivity, Mukherjee was understood to have not given a clear reply on deregulation of prices. Since deregulation is part of a larger issue, it would be discussed at length with various stakeholders and the Union Cabinet will take a final view, sources said. “Global crude oil prices have breached the $72 a barrel mark. Public sector oil retailers are likely to lose Rs 60,000 crore this fiscal if retail prices are not revised upward with the hardening of crude oil prices,” Deora told newspersons. He said the government had several options to bail out sate-owned oil retailers, who are selling petroleum products below cost price. These include raising the retail prices of petrol and diesel, issuing bonds to oil companies to make up for the revenue loss and asking upstream firms like ONGC and GAIL to sell crude to PSU oil retailers at a discount. At his meeting with the finance minister, Deora pushed for restoring tax breaks on natural gas production as is given for crude oil. “We have pleaded that the seven-year tax holiday from payment of income tax should also apply to natural gas as is available on crude oil production,” he said. The Cabinet had guaranteed exemption from payment of income tax on oil and gas production from areas awarded under the New Exploration Licensing Policy (NELP). But the finance ministry last year said this fiscal incentive was meant for oil only. This stand, which ran contrary to the government's written commitment while attracting investment under NELP since 1999, led to a poor response to the last auction round. This ambiguity over tax incentives has also led to postponement of the eighth round of bidding under the NELP.
15 June 2009;timesofindia.indiatimes.com:NEW DELHI: Concerned at the rise in international crude oil prices, the government is looking at solutions to tackle the widening revenue deficit and one of the options on the table could be raising petrol and diesel prices. "We are seriously concerned about the rise in crude oil prices ... we have to look for solutions," Petroleum Minister Murli Deora told reporters after meeting finance minister Pranab Mukherjee with his Budget wishlist. Deregulating petrol and diesel prices has been on the cards since the crude oil prices came down by $100 from the historic high of $147 a barrel, a few weeks back. But with the rates climbing again, doubts are being cast if prices can actually be freed. Crude oil prices are ruling at $71-72 a barrel, a seven-month high. "We have to seriously look at solutions... the alternatives before us are raising petrol and diesel prices, asking the government to make up for revenue loss (of fuel retailers) through issuing oil bonds and upstream firms (like ONGC) chipping in," he said. "It could even be all of the three as had been the practice till now," he added.
13 June 2009;economictimes.indiatimes.com:Piyush Pandey:MUMBAI: Even as the government is yet to take a decision on revising upward product prices of state-run oil companies, private oil firms, such Reliance Industries (RIL) and Essar Oil, are close to deciding on a price hike, as early as next week. While Essar Oil has decided to hike prices from June 16, RIL has not yet taken a final decision, according to people familiar with the development. Confirming the price revision, a senior Essar Oil official told ET: “At present, we are selling petrol and diesel at PSU rates in most of our retail outlets. Only in a few states, we are selling petrol that is Rs 1-2 higher than the PSU prices. With the sudden spurt in international crude oil prices, we are planning to increase petrol prices between Rs 1 and Rs 3 and diesel prices by about Re 1 and Rs 2 per litre. However, diesel prices may not be increased in Gujarat. The revised price will be effective from June 16.” RIL, which had recently started selling diesel at its 65 operational outlets, is yet to take a final call on the price hike. The company is awaiting for policy reforms from the government on prices of petroleum. “RIL has started operations progressively at some of its retail outlets during the last one month. Currently, only diesel is being sold through these outlets at prices at par with PSUs. We continue to monitor developments on fuel price deregulation to decide on further course of action,” said an RIL spokesperson. According to an analyst with international broking firm: “With crude trading over $72 per barrel, the margins have turned negative for private players. The more they sell, the more they lose. So, they increase prices to minimise losses. In the process, private players lose customers to PSU players.” In 2007, RIL gained a 14% of the market share in diesel sales. They currently have negligible market share after closing down most of their outlets. Essar Oil, with 1,230 operational outlets, has garnered close to 3% market share in the retail business over the past six months. Essar Oil has earned monthly revenues of Rs 240 crore in the January-March period. In an e-mail response to queries made by this paper, an Essar Oil spokesperson said: “Private players, including Essar, look forward to a level playing field which was promised before the investments were made in upstream and midstream sector. Huge investments made in the retail sector will be lying idle if the same is not implemented. This also has a major impact on the service.”
12 June 2009;economictimes.indiatimes.com:Chanchal Pal Chauhan: NEW DELHI: Maruti Suzuki India (MSI), the largest passenger car maker in the country, plans to take its latest A-Star hatchback to new markets, such as Africa and the Latin America, a top company executive said. Maruti is looking to tap new markets for exports, as the demand is shifting towards compact cars globally. This would help the automaker meet its target of exporting 1.5 lakh cars, across all models, in the current fiscal, two times that of the year ended March 2009. Maruti exports doubled to 15,978 units in the April-May period led by A-Star. Pitched as an export product, A-Star cars are already being shipped to France, Italy, the UK, the Netherlands, Germany and other major markets in Europe by Maruti. MSI executive officer (marketing & sales) Mayank Pareek said: “After its success in Europe and sufficient backlog of bookings, we have finalised strategy to enter other markets. A-Star comes with the new highly fuel-efficient K-series petrol engine, which is Euro-4 and Euro-5 complaint and will allow us to market the car throughout the world.” Maruti had developed A-Star originally for Europe, where it is sold under various brands, such as Alto, Pixo and Celerio, in different markets. The company plans to ship 70,000 A-Star cars to Europe this year, besides selling 30,000 units of the same model to Nissan Motor Co, which markets the product as Nissan Pixo in Europe. Maruti will now sell the car in Algeria, its biggest market in Africa, besides Chile, Mexico, Malaysia, Sri Lanka and Nepal and around 50 other markets, where it has sales and distribution network. Maruti, which serves as the exclusive small car producer and exporter for its Japanese parent Suzuki Motors, aims to export 200,000 cars a year by the year 2010-11. To give export a major thrust, it is developing India’s first dedicated car export terminal at Mundra in Gujarat. It recently became the first domestic car maker to cross the half million export mark this year.
11 June 2009;economictimes.indiatimes.com:Piyush Pandey:MUMBAI: State-run oil marketing companies like IOC, HPCL and BPCL are looking to the government for a revision in retail fuel prices with the current rally in global crude rates making them lose Rs 120 crore every day. Crude prices are at their peak this year at $71 per barrel, and these firms now lose Rs 3 on every litre of petrol sold and Re 1 on diesel. “We have requested the government to allow us to revise the prices of petrol and diesel,” said a director of a PSU oil firm on condition of anonymity. Retail fuel prices were last revised in January when crude oil prices averaged around $42 per barrel. “We suffer losses on selling petro products if crude prices cross $65 a barrel,” said a director with another oil marketing PSU. Apart from those incurred on the two major fuels, oil firms lose Rs 12 per litre on kerosene and Rs 60 per LPG cylinder, according to these companies. During the January-March quarter, these firms had enjoyed healthy margins with prices of crude oil lower by about 55% on a year-on-year basis. From its peak of $147 a barrel in July last year, crude prices touched a low of $32.40 in December. “Crude oil firming up signals the revival of demand in emerging economies such as India and China. The sharp run-up in crude oil prices in recent weeks could prevent the government from decontrolling the prices of sensitive petroleum products such as petrol and diesel,” said an analyst with an international firm. The margins of private petro-retailers like Reliance Industries (RIL) and Essar Oil have also turned negative. Both RIL and Essar Oil earned healthy margins in selling petrol and diesel in the fourth quarter of the last fiscal. Essar Oil earned revenues of Rs 720 crore from the sale of petrol and diesel in the January-March quarter. “We are losing Rs 2.5 per litre on petrol and Rs 1.5 per litre on the sale of diesel,” said an official at a leading private company.
See the 
