Oil stocks on buyers' radar as under-recoveries dip

PTI Posted online: Tuesday, Jun 17, 2014 at 0000 hrs
Mumbai : Shares of oil marketing companies - Indian Oil Corp, HPCL and BPCL - today gained as much as 4 per cent after losses on sale of diesel dipped to a record low.

IOC shares rallied 4.03 per cent, Hindustan Petroleum Corp Ltd scrip rose 3.87 per cent and and Bharat Petroleum Corp Ltd counter spurted 3.63 per cent on the BSE.

Experts said that PSU OMCs rose as the under-recovery on diesel declined.

Buying was also seen in other oil and gas stocks.

Shares of ONGC went up by 4.07 per cent, followed by RIL (2.39 per cent), Gail (2.55 per cent) and Oil India (1.43 per cent).

Losses on sale of diesel have dipped to a record low of Rs 1.62 per litre, raising the prospect of deregulation of the nation's most consumed fuel.

An official statement had yesterday said the difference between the cost of diesel production and the retail selling price has narrowed to Rs 1.62 a litre from Rs 2.80 in the first fortnight of June.

"Oil Marketing Companies (OMCs) are now incurring combined daily under-recovery (revenue loss) 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 statement had said.