Oil India's quarterly profit declines on lower crude realisations

Oil India, an Indian exploration company, reported on Tuesday that its third-quarter profits fell as lower realisations squeezed the margins despite higher fuel demand.

The profit of the state-owned company, which excludes earnings from overseas operations and joint ventures, dropped 33.8% for the third quarter to $80.2 million.

Oil India's crude price realisation, the price at which it sells its products, fell to $62.84 a barrel from $73.82 per barrel a year ago. This is in line with a drop in global crude prices. Brent crude fell by more than 9% in the quarter October-December.

As a result of the fall in crude prices, revenues fell, while costs rose, which squeezed margins. Oil India's margin has shrunk to 13.58%, down from 30.65% one year ago.

Oil India's revenue from its crude oil segment, which is the largest in terms of revenue, fell 10.7% to 49.16 billion Rupees. The revenue of its natural gas segment, however, increased by 3.2%.

The total expenditure of the company increased by?16.4%, to 45.15 billion Rupees.

According to the Petroleum Planning and Analyses 'Cell, India's fuel consumption, which is the world's third largest consumer and importer, rose 5.5% in November and 5.3% in December after falling by 0.4% in October.

Oil India has approved a second half-year dividend of seven rupees for the current fiscal year. ($1 = 90.5530 Indian rupees) (Reporting by Anuran Sadhu in Bengaluru; Editing by Sonia Cheema)

(source: Reuters)