NOC hikes prices of diesel, kerosene
KATHMANDU, JUN 20 -
The Nepal Oil Corporation (NOC) on Tuesday raised prices of diesel and kerosene by Rs 4 per litre, following its board meeting on Monday evening. The latest revision means both diesel and kerosene will now cost Rs 93 a litre. However, price of other fuels has remained unchanged.
With the latest hike in fuel price, the cash-strapped NOC is expecting to cut down on its current losses to ‘zero’ or even record a profitable position from the next month. Dwindling crude oil price in the international market has also supported the NOC to offset its losses. According to the NOC, its monthly projected losses have dropped from previous Rs 380 million to Rs 130 million with the hike on Tuesday. It will now enjoy a profit of Rs 11.88 on a litre of petrol and Rs 8.45 on kerosene.
Similarly, its currently makes a profit of Rs 15.84 and Rs 27.23 respectively on a litre from the sales of aviation fuel to domestic and international carriers. However, the corporation will still incur a loss of Rs 1.20 on a litre of diesel and Rs 453.07 on an LPG cylinder.
The NOC, which usually hikes price on the basis of international market, said that the latest revision in fuel price was done to bring itself into a break-even position. Brent crude oil price in the international market has dropped to US$ 96.32 per barrel on Tuesday as against US$109 per barrel in the same period last month. It was US$ 120.49 per barrel one year ago.
The Indian Oil Corporation, the sole supplier of fuel to Nepal, reviews export prices of petrol and diesel every fortnightly and other products such as kerosene, aviation fuel and LPG on a monthly basis.
“Although, the international price of Brent crude oil has been declining, we (NOC) decided to jack up price of diesel to offset the current losses and put the corporation at a break-even position,” NOC Deputy Director Sushil Bhattarai said. “As diesel supply accounts 60 percent of the total petroleum supply in the country, it was necessary to adjust the price.”
Bhattarai said that the government including banks and financial institutions had also informed NOC that they would not lend more money to NOC. “The latest hike is a move on part of NOC to adopt the automatic price adjustment mechanism and sustain the corporation,” said Bhattarai.
NOC’s loans to the government and banks and financial institutions currently stand at Rs 26.62 billion. “In the last month, NOC had burrowed Rs 3 billion loans alone,” Bhattarai said.
Source: The Kathmandu Post
