Buoyant refinery margins during the first two months of the current quarter (January to March 2008) are all set to perk up the profits of large oil refining companies in India.
Most state-owned refiners like Indian Oil Corp had reported negative GRM (gross refining margin) during the quarter ended December 31, 2008.
Private sector oil giant Reliance Industries Ltd, which operates a 33 million tonnes per annum (TPA), export-oriented refinery in Jamnagar, had also witnessed a decline in GRM to $10 a barrel during the quarter, against $13.4 in the previous quarter.
Essar Oil, which operates a 10.5 million TPA refinery in Vadinar, had seen its GRM slip to $2.26 a barrel from $6.59.
Fall in refinery margins had impacted net profits of all refining companies.
“Our GRMs were in double-digits during January and February,” said Naresh Nayyar, managing director and CEO, Essar Oil. “But it has again slipped to single-digits in the current month.”
As a result of the first two months, the average margins for the quarter would be in double digits, he said.