KATHMANDU, OCTOBER 14 – Nepal Oil Corporation (NOC) is expected to earn a monthly profit for the first time in two years largely due to the fall in crude oil prices in the international market.
The perennially broke state-owned oil supplier has projected Rs 261.4 million profit for this month. The oil monopoly had last earned a monthly profit of Rs 131 million in July 2012. It had reported an annual profit of Rs 3.31 billion in 2008-09.
Brent crude oil price has dropped $25 since June, and last Friday it fell below $90 a barrel, its lowest level since December 2010, according to a Reuters report. As per an agreement, Indian Oil Corporation (IOC) buys Brent crude oil from overseas markets and supply finished products to Nepal after processing.
As per the new tariff sent by IOC on October 1, NOC will enjoy profit on almost all the petroleum products, except for liquefied petroleum gas (LPG). IOC reviews export prices of petrol and diesel/kerosene every fortnightly and of other products such aviation fuel and LPG on a monthly basis.
According to the new tariff, NOC will earn Rs 12.67 profit on a litre in petrol, Rs 3.19 on a litre of diesel and Rs 16.19 on a litre of kerosene.
Its profit on aviation fuel sold to domestic and international carriers stands at Rs 41.58 and Rs 52.96 per litre, respectively. However, on LPG, it will incur a loss of Rs 511.28 per cylinder. The loss on LPG last month was at Rs 553 per cylinder.
NOC Managing Director Chandika Prasad Bhatta said the fall in international crude oil prices and also the administration reforms at NOC helped earn the profit. “We have also reduced the interest on loans NOC has taken from state-run financial institutions.â€
NOC’s loans taken from the government and banks and financial institutions currently stand at Rs 36.66 billion. Its losses amounted to Rs 2.05 billion last fiscal year
Fuel prices to be slashed
KATHMANDU: Nepal Oil Corporation (NOC) has said it will slash the prices of petroleum products soon under the auto pricing mechanism. Under the arrangement, the price of diesel and petrol would rise or fall when there is a minimum two percent fluctuation in the cost of finished products as determined by the Indian Oil Corporation. NOC Managing Director Chandika Prasad Bhatta said they were preparing to slash fuel prices of fuel, and added it would be a “surprising announcementâ€. The corporation had slashed Rs 1.44 on a litre of petrol and 27 paisa on a litre of diesel and kerosene each last month.
Source: eKantipur
