The Hindu Business Line : Indian crude basket rises to $60.27 a barrel

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New Delhi March 5 The price of Indian crude oil basket was up 21 cents on Friday, compared to the price a day earlier. The crude basket, which touched the highest level of this year on March 1 at $60.06 a barrel, went up to $60.27 per barrel on Friday. In effect this rise will increase under-recoveries of the State-owned oil marketing companies, which sell petroleum products at below cost price or subsidised rates, trade pundits say.

The Indian basket comprises Oman-Dubai sour grade crude and Brent dated sweet crude in 58:42 ratio. Last Friday, Brent was up 6 cents at $61.76 a barrel from the previous day. Dubai benchmark rose by 28 cents to $59.11 a barrel, while Oman crude stood at $59.43 per barrel up 35 cents. However, continued losses in the Asian and European stock market fed fears of potential slow down in economic growth that would undermine oil demand and this saw Brent crude below $61 a barrel on Monday.

In February, the Indian basket had averaged $56.53 per barrel compared with $52.53 in January. Indian basket touched the lowest during the current fiscal (April 2006 till date) on January 17 when it closed at $49.85 a barrel. It touched the highest on August 8, 2006 at $75.20 a barrel. The prices of petrol and diesel were first reduced on November 30, last year and again on February 16. The reduction was Rs 2 per litre and Re one per litre (in Delhi) for petrol and diesel respectively on each occasion. The price of domestic liquefied petroleum gas (LPG) was last revised on November 5, 2004. However, the basic price of kerosene sold under public distribution system has not been revised since April 1, 2002.

After factoring in the excise duty cut on petrol and diesel from February 28 and recent reduction in prices of these two products the oil marketing companies were suffering under recovery of Rs 1.24 per litre on petrol and Rs 1.52 per litre on diesel.