First quarterly loss for Indian Oil in four years owing to inventory hit
Following a heavy drop in crude oil rates, India’s top refiner, Indian Oil Corp Ltd, brought to light its first quarterly loss in a span of more than four years in the March quarter, owing to an increase in inventory losses.
As the company holds about 45 days inventory, the drop in crude oil prices affected the Corporation’s financial performance for the January- March quarter.
There was 65.6 percent drop in Brent crude oil prices.
It was reported that there was an estimated Rs 14,692 crore worth of inventory losses, against a gain of Rs 2,655 crore the previous year.
The March quarter gross refining margin for Indian Oil was minus $9.64 per barrel against $4.09 per barrel, last year.
The coronavirus lockdown rendered a sharp decline in fuel demand during the end of March.
Indian Oil Corp Ltd is currently operating its refineries at 90 per cent capacity, hoping to increase the operations to 100 per cent by the end of July.
Writer – Arunima SenGupta