Amid soaring oil loss, the Indian government had earlier announced possible hike, especially after a high-level panel recommended it to plug the loss giving rise to a fiscal hole. However, failing to build consensus, especially in the wake of soaring food prices, Indian Oil Minister recently announced the postponement of the plan. [break]
“This has relieved us as well as the consumers,” said Nepal Oil Corporation (NOC) Spokesperson Mukunda Dhungel.
Had India increased the retail prices, NOC would have been under a severe pressure to make changes in line with it, especially to plug the outflow of fuel. Owing to porous border, any difference in prices triggers cross border smuggling and given that NOC itself was incurring huge loss, such illegal outflow would have added burden to it.
NOC has further announced that its loss on oil imports and retailing has dropped almost to half for the second half of February than the first half of the month.
Referring to the new pricing received on Tuesday, NOC has attributed the drop in loss to the decline in the import price for diesel as well as petrol.
At the new import rate, NOC is presently incurring a loss of 21 paisa per liter whereas it was about a rupee per liter previously. Likewise, the import price for petrol too has dropped, raising profit margin for NOC to Rs 1.86 per liter from Rs 1.73 of the past.
“While the import rates for other commodities are unchanged, NOC´s monthly loss at the new rates is estimated at Rs 39.3 million, down from Rs 79.50 million of similar previous estimates,” said Dhungel.
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