Industry experts, analysts say the proposal is 'impractical'. The country's oil refining companies are hopeful that the Organisation of Petroleum Exporting Countries will implement a price band for crude oil which they say will bring more certainty to their operations.
The realty companies include Housing Development and Infrastructure Ltd and Hyderabad-based Vasundhara Projects, while the oil services company is Hydrocarbon Resources Development.
Profits of the country's oil marketing companies - Indian Oil Corporation, Bharat Petroleum Corporation and Hindustan Petroleum Corporation - fell by as much as 29 per cent in 2007-08 in spite of an up to 56 per cent rise in the oil bonds these companies received during the year compared with 2006-07.
Oil and Natural Gas Corporation, the country's most profitable company, is far behind its global counterparts in terms of revenue earned per barrel. The oil major makes a profit of around $10 a barrel for every barrel of oil it sells, while its global peers earn a profit of over $70 a barrel.
The under-realisation on fuel sales reported by the country's oil companies is overstated by as much as 15 per cent, according to experts, though this does not mean that the oil companies are making profits on selling subsidised petrol, diesel, cooking gas and kerosene.
Under-recoveries by state-owned oil marketing companies are set to hit a new record in June with the under-realisation on the sale of diesel, the largest selling fuel and also the most politically sensitive, almost matching the subsidised selling price.
Oil and Natural Gas Corporation, the country's largest oil and gas producer, is planning to sell 30 to 40 per cent each in two blocks in Vietnam to share the risks and drilling costs. ONGC owns 100 per cent in the two deepwater exploration blocks.
A depreciation in the value of the rupee against the dollar, coupled with surging crude oil prices, are likely to push the country's crude oil import bill to over $100 billion in 2008-09, from $77.02 billion in 2007-08, according to industry officials.
The domestic supply of diesel has been constrained on rapidly growing demand. The diversion of supplies from Reliance Industries, which was given export-oriented unit status last year, has added to the shortage. Reliance produces 10 million tonnes of diesel from Jamnagar.
Rising export of petroleum products helped Commerce Minister Kamal Nath meet 96 per cent of the targeted $160 billion worth of exports in 2007-08, but it could not contain the country's net oil import bill. The net oil import bill in 2007-08 is likely to rise by around 41 per cent over 2006-07 as the country's refineries consumed 9 per cent more crude oil to meet surging demand even as crude oil prices rose nearly 53 per cent during the year.
After the UK-based Hinduja group, Oil and Natural Gas Corporation's proposed Rs 26,500-crore (Rs 265 billion) refinery at Kakinada, Andhra Pradesh, has found new suitors in Reliance Industries and Essar Oil.
The value of the stake is not immediately known but ONGC Videsh Ltd (OVL) -- the overseas investment arm of Oil and Natural Gas Corporation -- is likely to pay an initial $300 million for drilling operations. Russian company Rosneft, which owns 70 per cent in the project, will be offloading its stake to OVL if the deal goes through. The remaining 30 per cent stake is held by China National Petroleum Corporation.
Indian Oil Corporation, the country's largest petroleum product marketer, has already started selling only premium fuels in nearly 25 of the 50 fuel stations it has in Mumbai, and in almost 10 of 50 outlets in Delhi. Bharat Petroleum Corporation and Hindustan Petroleum Corporation are also planning to follow IOC's example.
The 31 rigs were operating in India's offshore areas till February this year, making the country the largest offshore rig user in the world after the US, where 56 rigs are operating. Countries such as Brazil and Mexico have now overtaken India.
From zero presence in the Indian power equipment market a couple of years ago, Chinese companies are likely to supply as much as 30 per cent of the equipment required to meet the Eleventh Plan capacity addition target of 78,000 Mw.Chinese companies are also bagging large orders from private power companies in India, despite the perception of "suspect quality".
The three state-owned oil marketing companies say they expect to report losses in the fourth quarter of the 2007-08 financial year with the government likely to bear 42.7 per cent of their retail losses against the 57 per cent it had promised in February. The three companies, IOC, BPCL and HPCL bear revenue losses because they are forced to sell petrol, diesel, cooking gas and kerosene at subsidised prices.
The mandatory 10 per cent ethanol blending in petrol may not happen for the existing 101 million vehicles on the Indian roads without introducing technical changes in them. The central government plans to make 10 per cent blending compulsory from October from the current 5 per cent. Existing vehicles are not capable of running on 10 per cent ethanol-blended petrol as ethanol releases more heat and can corrode vehicle engines, experts say. It will lead to a 3% drop in mileage.
The retail losses that the country's oil marketing companies incur on sale of petrol, diesel, cooking gas and kerosene at subsidised prices have risen by 7.3 per cent to around Rs 440 crore (Rs 4.4 billion) per day in the fortnight ended March 31.IOC lost Rs 17 for every litre of petrol it sold, up from Rs 14.65 a litre on March 15. It lost Rs 316 per 14.2-kg cylinder, compared with Rs 303.65 per cylinder in the previous fortnight.
The over 1.6 million employees of central public sector companies are demanding a salary increase of over 100 per cent, saying the average 40 per cent raise recommended by the Sixth Pay Commission for government employees is not enough. Salaries of public sector workers were last revised in 1997 and were scheduled for the next revision on January 1, 2007. The average gross monthly salary an ONGC executive earns today is between Rs 40,000 and Rs 50,000.
In a step towards dual pricing of domestic cooking gas, the government has decided to allow oil-marketing companies to sell the fuel at market prices in distinct fibreglass cylinders. IOC, BPCL and HPCL will sell these cylinders in Bangalore, Mumbai and Pune, which have been identified as test beds for the pilot project. The companies could revise fuel prices for transparent cylinders as LPG for them will not be subsidised. Feasibility of this project is yet to be adjudged.
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