Petrol and diesel prices were on Wednesday (15 July) cut by Rs 2 per litre, excluding local levies, in the second reduction of rates this month by oil companies, but the petrol would actually become costlier in the national capital due to an increase in VAT rate here. The decrease in diesel prices would also be less in Delhi due to a hike in Value Added Tax (VAT) by Arvind Kejriwal-led Aam Aadmi Party government. The new rates announced by the oil marketing companies will be effective from midnight tonight. While, the reduction in petrol and diesel prices was reflective of local trends, the consumers in Delhi will not be able to get the benefit as the Arvind Kejriwal government raised VAT on the two fuels robbing city customers of the reduction. While the rates will reduce by a bigger number all over the country, petrol price in Delhi will go up by 28 paise a litre after considering local government's decision to hike VAT or sales tax on the fuel from 20 to 25 per cent. Similarly, diesel rates will fall across the country. In case of Delhi, where the VAT on the fuel has been raised from 12.5 per cent to 16.6 per cent, there will be smaller reduction of 50 paise per litre. Petrol in Delhi will cost Rs 66.90 per litre from tomorrow instead of Rs 66.62 at present. A litre of diesel will cost Rs 49.72 per litre as against Rs 50.22 earlier, Indian Oil Corp (IOC), the nation's largest oil company, said. "Prices of petrol and diesel were last revised w.e.f. 1st July'15. Since last price change, there has been a decrease in international prices of both Petrol & Diesel. INR-USD exchange rate has also appreciated during this period. Combined impacts of both these factors warrant the said downward revisions," it said. Price of petrol was last cut on July 1 by 31 paise per litre and diesel by 71 paise a litre. "Since last price change, there has been a decrease in international prices of both petrol and diesel. Indian rupee-US dollar exchange rate has appreciated during this period. Combined impact of both these factors warrants a downward revision in prices, the impact of which is being passed on to the consumers with this price decrease," IOC said. The July 1 reduction in petrol prices came on back of three successive increases since May. In case of diesel, the July 1 cut was the second reduction in rates sine June. Prior to that auto fuel rates were last revised on June 16 when prices of petrol were hiked by 64 paise a litre but diesel rates were cut by Rs 1.35 per litre. State-owned fuel retailers IOC, Bharat Petroleum Corp (BPCL) and Hindustan Petroleum Corp (HPCL) revise petrol and diesel prices on 1st and 16th of every month based on average imported cost and rupee-dollar exchange rate in the previous fortnight. "The movement of prices in international oil market and Rupee-USD exchange rate shall continue to be monitored closely and developing trends of the market will be reflected in future price changes," IOC statement added.(Agencies)
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The company's Ebita margin has improved due to global fall in crude oil prices, writes Arshad KhanRating agency India Ratings and Research has upgraded I G Petrochemicals Limited’s (IGPL) long-term issuer rating to 'IND A-’ from ‘IND BBB+’, maintaining a stable outlook for the petrochemical company. The rating agency gives reduction in total debt and an increase in EBITDA margins of the company as the prime reason for its up gradation. “IGPL’s EBITDA margin improved 165bp y-o-y to 6.7 per cent in FY15 due to the capex completion and process improvement initiatives taken in FY14. The rating agency expects the EBITDA margin to further improve in FY16 because of high demand of phthalic anhydride (PAN) and improved operational efficiency,” notes the agency in its report, Company’s EBITA margin also improved due to global fall in the prices of crude oil as its main raw material ortho-oxylene is a crude derivative. It is also exposed to forex risk as exports form 19 per cent of the total revenue and imported raw materials form 16 per cent of the total raw material consumption. IGPL partially hedges its exports as well as imports using forward covers apart from having a natural hedge, reducing the risk to an extent. The rating agency reports that the petrochemical company has started drawing benefits from capacity addition as well as process improvement initiatives like reducing furnace oil requirement and using generated steam to meet its power requirements. Other push by the company which improved its rating includes imposing of anti-dumping duty by the government of India which enabled IGPL to protect its margin. Positive cash flow form operation and maintaining moderate liquidity further helped the company to upgrade its rating. The rating agency further reports that company’s plan to raise Rs 400 million in FY16 and FY17to manufacture downstream speciality chemicals will enable IGPL to diversify its product portfolio. The agency expects the credit metrics to remain stable post this capex.
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International oil prices will come down with the imminent lifting of sanctions against Iran and benefit India, Petroleum Minister Dharmendra Pradhan said on Wednesday. "With Iran coming to market, the assumption is that there will be further slide in oil prices... India will be one of the beneficiaries of sliding oil prices," he said. India is the world's fourth largest oil consumer and also the second biggest buyer of Iranian oil after China, importing about 11 million tonnes of crude oil in 2014-15. Due to its relative proximity to Iran and established business ties, India is tipped to be one of the first and biggest takers of Iranian oil once sanctions are lifted or eased, although Pradhan said the government would first have to study available offers. Pradhan remained non-commital on whether India will increase imports from Iran after restricting it at 11 million tonnes in the past two fiscal. "Let's see. It (increasing imports) depends on a lot of commercial considerations," he said. "But one thing is sure, oil prices (in international market) will be reasonable. I believe prices will be reasonable and responsible." The slide in oil prices may, however, put some pressure on exploration and production (E&P) business due to low returns, he said here at an industry event while adding this was "a challenge." As per the deal, sanctions imposed by the US, European Union and United Nations will be lifted in return for Iran agreeing long-term curbs on a nuclear program that the West suspected was aimed at creating a nuclear bomb. However, the sanctions on Iran will remain in place at least until United Nations monitors report on the country's compliance with the deal in December. Also the deal has to be ratified by the US Congress within 60 days. This means Iran may take until next year to bolster crude exports. Its exports may double to 400,000 barrels per day in 2016 production and will likely expand the following year, according to Goldman Sachs. Analysts said that Iran's exports would only gradually increase from 2016. "New oil will not flow from Iran until 2016 and there will probably be less of it than optimists predict," said Richard Nephew, Program Director for Economic Statecraft, Sanctions and Energy Markets at the U.S. Center on Global Energy Policy. "I estimate 300,000–500,000 new barrels of oil on the market within 6-12 months after a deal begins to be implemented." (Agencies)
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A day after an Iran nuclear deal was finally reached oil prices edge higher as investors recognised it would take time for Tehran to raise output, but the eventual increase in its exports will add fuel to a market already plentifully supplied.Under the agreement, sanctions imposed by the United States, the European Union and the United Nations are to be lifted in exchange for curbs on Iran's nuclear programme."New oil will not flow from Iran until 2016 and there will probably be less of it than optimists predict," saidRichard Nephew, Program Director for Economic Statecraft, Sanctions and Energy Markets at the US Center on Global Energy Policy."I estimate 300,000–500,000 new barrels of oil on the market within 6-12 months after a deal begins to be implemented," he said.Morgan Stanley said most assessments saw 500,000 to 700,000 barrels per day (bpd) of new supply by the first half of 2016.Front-month Brent crude prices were trading at $58.72 per barrel at 0353 GMT, up 21 cents from their last settlement. U.S. crude was up 28 cents at $53.32.Iran, a member of the Organization of the Petroleum Exporting Countries (OPEC), exported almost 3 million bpd of crude at its peak, before sanctions over its alleged ambitions to build a nuclear bomb saw shipments collapse to about a million bpd over the last 2-1/2 years.Adding To A Glut, For NowBeyond the realisation that it will take time for Iranian exports to return to pre-sanctions levels, the prospect of more supply coming into the market just as China's economy grows at its slowest pace since the 2008/2009 crisis means oil prices are likely to remain low in the foreseeable future. Even without a jump in production from Iran there are already 2.5 million bpd of available crude that consumers don't need.Oil prices have halved over the past year as established producers like OPEC and Russia pump near record levels at the same time that American shale drillers have turned the United States into the world's top oil producer.In China, the world's biggest energy consumer and number two economy, growth is stalling and there are signs that its fuel thirst will also start to ebb. Other parts of Asia are showing signs of economic weakness as well.China halved its 2015 forecast for vehicle sales growth to a meagre 3 percent last week as a major slump in the country's stock market depressed sales to consumers concerned about economic prospects."Given the current macroeconomic environment and unbalanced fundamentals we have revised our central oil prices down once again," investment bank Natixis said."For Brent we expect 2015Q3 and 2015Q4 to average $60/barrel and $59/barrel, respectively, and 2016Q1 to average $57/barrel," the bank said, adding that U.S. crude would trade at a discount of $4-6 per barrel to Brent.Natixis also said Brent would average $59.20 a barrel in 2015 and $62.30 a barrel in 2016, and that there was a risk of even lower prices if China's economy slowed further while global oil production stayed close to its near-record highs.It is only further in the future, analysts say, that Iran's oil will help prevent a shortage rather than add to a glut."In long-term, the Iranian oil will actually be needed to keep the market balanced, especially as demand will generally rise for some time to come," said Richard Gorry, managing director of JBC Energy Asia.(Reuters)
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With cities being under water during monsoon, will the people running the municipalities wake up and provide the basic amenities that will form the crux of being smart, asks Manish Kumar PathakThe monsoon is well under way in most parts of the country. This is not something out of the ordinary. It is an annual affair, and in many quarters comes as a relief from the sweltering heat. However, after two or may be three days, this pleasure gives way to compounding pains. The appalling conditions of the roads, the stagnant water which is a reminder of the stagnant state of municipal bodies.‘Smart Cities’ is a much sought after programme, a rather ambitious one, and deserves all the support that it merits. But will the people running the municipalities wake up and think about providing the basic amenities that will form the crux of being smart. Drainage system goes for an absolute toss, whenever sustained rainfalls hits our cities, and to make matters worse the officials donning the hat of responsibility in the municipality offices are isolated from any accountability; perhaps they remain isolated from any work throughout their tenure.Political influence plays a big part in the appointment of these officials, and therein lays the loop-hole. In the garb of extending their political clout they are more into appeasing the higher authorities rather than getting down on the grounds and doing their jobs. The National Capital Delhi, has become a drain, with waterlogged streets proving to be a nightmare for commuters. Overflowing drains, littered wastes and hapless citizens are forced to wade their way through the mess. Who then should be held accountable? Not very long ago, the staff of the Municipal Corporation of Delhi (MCD) was up in arms against the government for not paying them. After that matter was resolved, who will lodge a protest against this muddle? Yes, there was protest, the Twitter hashtags that surfaced pretending to carry the grievances of the masses. There was a lot of noise, hurling accusations, and then everything was thrown into cold-storage.Are we then equally responsible? Do we have the basic traits of civic responsibilities, or have we become so prone to the garbage strewn around us, that it no more bothers us. The unplanned construction that intrudes on otherwise planed streets are only aggravating the issue. The dumping of wastes by the common-folks at places where it is not supposed to be dumped eventually comes back to bite us. Knowingly, or unknowingly we have become a part of this mindset, that things will not change, and we are just a trivial entity in this entire nexus of corruption. So we either blatantly ignore rules, or just close our eyes.We also forget very easily. After all the howling at the politicians for their inefficiency (politicians that we have elected), this anger will slowly evaporate as the rains cease. Across political circles there is this psyche that we civilians will just forget and move on. When then are we planning to change, when we will demand that these basic amenities are a supreme must?‘Smart Cities’ may still be realised, but are we willing to be smart citizens?
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Salzer Electronics Limited has entered into a technical licensing agreement with Austria-based Trafomodern Transformatorengesellschaft M.B.H.Salzer will use Trafomodern’s technology and design and assistance to manufacture dry type air cooled transformers, Chokes and inductors in India. Dry type transformers is a highly specialised and technical product with applications in Medium & large UPS, renewable energy business, railways, power generation and the marine industry.The cost of the project is around Rs 22 crore excluding the land as the company has surplus land adjacent to its existing land.R. Doraiswamy, Managing Director, Salzer Electronics Ltd said, “Using Trafomodern's technology, we will start manufacturing of dry type transformers in India for our customers here and abroad. Currently, there are very few companies that manufacturer this product in India and most of our customers have to import these transformers.Trafomodern is one of the leading manufacturers of dry type transformers in Europe.Salzer will market this new product in energy management (UPS), Metro Rail, Solar Energy, Wind Energy, Industrial Segment and Marine. The estimated business value in UPS is $250 mn and the estimated business potential in solar/wind energy is $200 mn."Our customers have indicated that they would source the dry type transformers from us, once we start making them.” Doraiswamy added.
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Oil prices dipped on Tuesday as the market awaited a nuclear deal between Iran and six global powers that could see an easing of sanctions against Tehran and a gradual increase in its oil exports, while Asian economies showed new signs of slowing. Sources present at the talks in Vienna, Austria, said that an announcement was likely in the early hours of Tuesday. Iran's semi-official Fars news agency reported that a meeting would be held at 0800 GMT on Tuesday between all parties to discuss a possible final deal to curb the country's nuclear work in exchange for lifting sanctions. Front-month Brent crude futures dropped 61 cents to $57.24 a barrel at 0409 GMT. U.S. crude was trading at $51.48 per barrel, down 72 cents. "With a nuclear deal imminent, it is clear that Iran is preparing to make up lost ground and re-establish itself as a major supplier," said Sarosh Zaiwalla, a London-based sanctions lawyer. "Sanctions have crippled Iran's oil production, halving oil exports and severely limiting new development projects. The prospect of them being lifted is creating great excitement ... as foreign trade and investment will allow Iran to make huge efficiencies and drive down the cost of production." Analysts say it would take Iran many months to fully ramp up its export capacity following any easing of sanctions. But even a modest initial increase would be enough to pull international oil prices down further as the market is already producing around 2.5 million barrels per day above demand. "We continue to expect further (oil price) drops if Iranian crude flows into the market," Daniel Ang of Singapore-based Phillip Futures said in a report. Slowing AsiaMeanwhile, the outlook for some Asian economies dimmed further, potentially eroding oil demand. China's economic growth is forecast to be the weakest since the 2008/2009 global financial crisis in the second quarter, which together with a stock market rout raises pressure on authorities to do more despite little pay-off so far from a run of stimulus steps. In Singapore, Asia's main oil trading hub and one of the region's biggest ports, the economy unexpectedly contracted in the second quarter as sluggish global demand knocked the city-state's manufacturing sector. (Reuters)
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Bharat Petroleum Corp Ltd plans to expand its Bina oil refinery in Madhya Pradesh by 30 per cent to 156,000 barrels per day at a cost of about $472 million, its chairman S. Varadarajan told Reuters on Monday (13 July).The expansion of the refinery, operated by a joint venture of BPCL and state-owned Oman Oil Co in Madhya Pradesh, will be completed by 2018, he said.Oman Oil, which has a minority stake in the venture, is not participating in the Rs 30 billion expansion as of now, Varadarajan said.(Reuters)
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