NEW DELHI: State-run IndianOil on Friday slipped into the red for the first time in two years due to a freeze on pump prices, with the country’s largest oil refiner and fuel retailer posting a loss of Rs 1,992 crore in the April-June period against profits of Rs 6,021 crore in the preceding March quarter and Rs 5,941 crore in the year-ago period.
The company’s revenue during the period rose almost 62% to Rs 2.51 lakh crore during the quarter from Rs 1.55 lakh crore a year ago, the company said on Friday.
But the losses from petrol and diesel eroded part of the record refining margins of $31.8 per barrel against $6.58 per barrel in the previous corresponding period. The effective margin after offsetting inventory losses stood at $25.34 a barrel.
“The suppressed marketing margins of certain petroleum products have offset the benefit of an increase in GRM (gross refining margin),” the company said.
The company had last posted a loss in the January-March quarter of 2020 due to inventory losses caused by Covid-induced oil price collapse.
Earnings from the petrochemicals business also tanked 84% to Rs 269 crore from Rs 1,737.8 crore during the quarter under review. The loss was despite more than 22% growth in sales to almost 23 million tonnes and 13% rise in refinery output.
IOC – and the two other state-run retailers HPCL and BPCL – froze petrol and diesel prices for 137 days till elections in five states, including UP, ended in March. After the polls, prices were raised by an aggregate Rs 10 per litre each, only to be frozen even though oil prices shot through the roof after the Ukraine conflict broke out. On May 22, the prices were reduced due to a cut in excise duty but have remained steady since then. In the meantime, the under-recovery on petrol and diesel had shot up to Rs 18 per litre.