No alternative to raising fuel price: NOC
Kathmandu, July 19
While Nepal Oil Corporation (NOC) has not revised the price of petroleum products following protests after price hike, the state-owned fuel supplier has said it will have no other option than to raise the fuel price next month if its rate in the international market continues to rise.
“We are currently analysing the global fuel price trend. If it continues to surge, we will raise fuel price effective from August,” said Birendra Goit, spokesperson for NOC.
As per the most recent price list that NOC's supplier - Indian Oil Corporation (IOC) - sends on the first and 16th working day of the English calendar, NOC's monthly loss has ballooned to over half a billion rupees.
“Based on IOC's fuel rates for the second half of July, NOC's monthly loss has gone up to Rs 510 million,” Goit said.
Though significant decline in global crude oil price since the past few years had proved to be a boon for the debt-ridden NOC, surging fuel price in the international market at present has become a headache for the enterprise once again.
Oil price, which had dropped to as low as $27 per barrel in 2016, has reached almost $73 per barrel in the international market today. Until April, crude oil was available at almost $65 per barrel.
As per IOC's new rate, NOC is incurring losses in petrol, diesel and liquefied petroleum gas (LPG) while it enjoys profit in kerosene and aviation turbine fuel (ATF). The state-owned fuel company is incurring loss of Rs 233.9 in every cylinder of cooking gas. Similarly, its loss in diesel stands at Rs 2.90 per litre and 0.52 paisa per litre in petrol.
However, NOC records profit of Rs 17.79 per litre in kerosene and Rs 12.53 per litre in ATF.
While its monthly loss has been accumulating, the price stabilisation fund with Rs four billion has remained unutilised.
“Utilising resources from the fund is not under the jurisdiction of NOC's management,” informed NOC's Acting Deputy Managing Director Sushil Bhattarai. As per him, fund can only be utilised during emergencies.
Currently, petrol costs Rs 110 per litre in the domestic market while diesel and kerosene cost Rs 93 per litre each. Similarly, LPG costs Rs 1,375 per cylinder.