Due to this, the price of oil at the petrol pumps of both the companies may be slightly higher than the current price.Image Credit source: File Photo
Now the price of petrol and diesel is being charged according to the market rate at Jio-BP and Naira petrol pumps. Both these private sector companies have taken this decision after passing more than a year. Earlier, companies like Jio-BP, Naira Energy and Shell were selling petrol and diesel at huge losses.
Private sector companies have to face a tough challenge from government companies like Indian Oil, Bharat Petroleum and Hindustan Petroleum. These companies sell fuel at a much lower rate than Jio-BP and Nayara Energy. That’s why private sector companies were selling petrol and diesel at a loss.
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Decision on cheap crude oil
Crude oil continues to be cheap in the international market. At the same time, India is buying crude oil from Russia on a large scale at a discount rate. According to the news of PTI, in view of this, private fuel companies have decided to sell petrol and diesel at the market rate. This will help companies to bridge their losses.
Companies like Jio-BP, Nayara Energy and Shell sold petrol and diesel at a loss, yet their prices remained slightly higher than that of government companies. Now to match the market rate, they will have to sell petrol and diesel only at the rates of government companies.
Let us tell you, Jio-BP is a joint venture between industrialist Mukesh Ambani Reliance Industries and UK company BP. Whereas Naira Energy is funded by Rosneft, one of Russia’s largest oil companies.
1 rupee a liter cheap selling oil
There are a total of 86,855 petrol pumps in India. Out of this, 7 percent of the petrol pumps are owned by Nayara Energy. The company has started selling petrol and diesel at market rates from March itself. While Jio-BP is selling diesel at market price from this month at its 1,555 petrol pumps. At present, Jio-BP is giving a discount of Re 1 per liter as compared to the rate of government companies.
However, due to the reduction in the prices of crude oil, the losses of government companies have also come down. In the last 6 weeks, due to the continuous fall in the prices of crude oil, government companies are selling petroleum at cost only. This week crude oil price has come down to $78 per barrel. In such a situation, it is possible that government companies may reduce the prices of petroleum in the coming days.