Crude oil has fallen to a four-year low, and global rates are down nearly 30% in the last quarter. Oil marketing companies are buying cheaper crude and seeing higher margins, but retail fuel prices haven’t dropped in months. The reason: taxes and duties remain high, shielding consumers from the benefits.
Crude oil prices have been falling and pump rates remain largely steady, but state-run IndianOil’s net profit has still dropped by 67%. The question now is why margins are getting squeezed, with attention turning to the lingering impact of past subsidies and under-recoveries that can distort earnings even when fuel prices don’t move.
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