OREANDA-NEWS. Indian Oil Corporation Ltd. has decided to effect the changes in MS retail selling prices w.e.f midnight of 1st/2nd March’13 upwards by Rs.1.40 /litre (excluding VAT).

MS prices were last revised upwards by Rs.1.50/litre (excl VAT) on 16th Feburary'13. The price increase has been necessitated by two factors :

(a) The international MS prices have increased from USD 128.57/bbl to USD 131.00/bbl since the last revision; and

(b) The rupee has depreciated from Rs.53.43 to Rs.54.15 per US Dollar during the period.

The combined impact of these two factors has compelled the company to revise the prices. The Corporation does not have any other option but to pass on the increase in MS prices to consumers as the Corporation has already suffered losses on sale of MS during the year.

It may be added that International MS prices over the year have shown spurt during the first quarter of the calendar. They generally start leveling back during the second quarter. Keeping this trend in view, we do believe that there should be opportunities to revise the prices downward as and when the international MS prices soften.

The trends of international oil prices and INR-USD exchange rate shall be closely monitored and the same shall be reflected in future price changes.

In addition to loss on sale of MS, OMCs are also suffering under-recovery on sale of HSD of Rs.11.26/litre, SKO (PDS) of Rs.33.43/litre & LPG (Dom) of Rs.439.00/cyl. Projected under-recovery of the Corporation on three sensitive products is expected to cross Rs.86500 crore and of the Industry beyond Rs.163500 crore during current year.