Worried of lower domestic demand in their profitable jet fuel business, state-run oil marketing companies (OMCs) have written to the petroleum ministry seeking permission to export aviation turbine fuel (ATF).
Worried of lower domestic demand in their profitable jet fuel business, state-run oil marketing companies (OMCs) have written to the petroleum ministry seeking permission to export aviation turbine fuel (ATF). This follows the decision by airline companies—the only customers for jet fuel—to directly import ATF to save on taxes levied by state governments.
Bharat Petroleum, Hindustan Petroleum and Indian Oil Corp are three state-run companies for whom selling ATF is a key source of profit and contributes around 5% to their overall revenues.
"OMCs have written to the ministry to get permission to export ATF," a senior official at one of the state-owned oil marketing companies told moneycontrol.com.
"For instance, regions in West and East Asia produce crude but they import around 10 million tonnes annually. We will soon start marketing the commodity in international markets."
Currently, OMCs together produce 5.5 million tonnes of ATF and are awaiting a nod from the ministry for exporting the commodity, though a decision on the matter is expected to take some time.
Officially, oil companies are denying any such move.
"There is nothing of that sort happening," a Bharat Petroleum Corporation spokesperson told Moneycontrol.com.
Indian Oil Corporation too has denied the move.
"As and when there is any such development, we will make an announcement. But there is nothing as of now," the spokesperson said.
Earlier, when airlines got an approval from the Director General of Foreign Trade (DGFT) to import ATF, oil retailers had opposed the government's decision. They pointed out that importing ATF would mean an undue burden on port infrastructure in the county. They had even said they will not be able to share any infrastructure facility at any port location, something airlines wanted to hire, once they start importing fuel.
It may be recalled that in 1996, OMCs were allowed to export ATF, when there were not many airlines operating in the country. However, in 2005, the government imposed restrictions on jet fuel exports.
BPCL stock price
On July 29, 2015, Bharat Petroleum Corporation closed at Rs 949.45, up Rs 4.25, or 0.45 percent. The 52-week high of the share was Rs 987.00 and the 52-week low was Rs 561.15.
The company's trailing 12-month (TTM) EPS was at Rs 70.32 per share as per the quarter ended March 2015. The stock's price-to-earnings (P/E) ratio was 13.5. The latest book value of the company is Rs 339.42 per share. At current value, the price-to-book value of the company is 2.80.
Set email alert for
ADS BY GOOGLE
video of the day
Sensex yr-end target 26900; cherry-pick pvt banks too: HSBC