New Delhi: Oil and Natural Gas Corp’s (ONGC) net profit for the three months ended September rose 61.1 per cent on year to Rs 8,265 crore as higher crude oil prices during the quarter lifted the state-owned upstream major’s oil price realisation. The company’s revenue from operations rose 47.6 per cent on year to Rs 27,989 crore in Jul-Sep.
Sequentially, ONGC’s net profit rose 34.5 per cent while revenue from operations was up 2.9 per cent, as crude oil prices appreciated on a quarter-on-quarter basis. Its net crude oil price realisation for the reporting quarter was at $73.07 per barrel, up from $49.43 per barrel in the year-ago period and $71.48 per barrel in Apr-Jun, ONGC said in a post-earnings release.
Better price realisation was a direct result of the rise in international prices of crude oil in the reporting quarter. ONGC did not share fuel subsidy losses incurred by state-owned oil marketing companies in Jul-Sep. The company had not shared the subsidy burden in the year-ago quarter, as well as in Apr-Jun.
According to an ad-hoc subsidy-sharing mechanism, state-owned upstream oil companies can be asked by the government to share losses incurred by state-owned fuel retailers on sale of fuels at subsidised rates. For a few quarters now, state-owned upstream oil companies haven’t been asked by the government to share the subsidy burden.
However, with the recent spike in crude oil prices hitting the government’s capacity to foot the entire fuel subsidy bill on its own, some reports suggested that ONGC and Oil India may be asked to share the burden. ONGC’s total expenditure for the reporting quarter rose 28.1 per cent on year to Rs 17,678 crore, primarily due to a 46.8 per cent on-year rise in outgo towards statutory levies to Rs 6,607 crore.
