No impact of Opec cut on India, say experts

The decision by the Organization of the Petroleum Exporting Countries' (Opec) to cut crude oil production by 1.2 million barrels per day (mbpd) is unlikely to have an impact on India's crude oil subsidy figures, say experts.   Financial Astrology Tips

One of the largest importers of crude in the world, India has benefited highly from the low price regime. An Opec output cut might raise prices and, therefore, subsidies, is the worry However, experts say, a global crude oil price of $50-55 a barrel is comfortable for India. It is believed that prices are unlikely to climb above this.

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"With diesel price deregulation, the only subsidy burden on the government is of LPG (cooking gas) and kerosene, expected to remain below Rs 30,000 crore in FY17. On the other hand, the sector is providing excise revenue in excess of Rs 160,000 crore to the government, a net contributor to the fiscal situation," said Debasish Mishra, partner at Deloitte Touche Tohmatsu India.   Stock Market Astrology Tips

With both petrol and diesel out of the subsidy burden, under-recoveries on both domestic LPG and kerosene came down to Rs 27,571 crore in 2015-16, from Rs 76,285 crore in 2014-15. For 2016-17, the budgeted subsidy is Rs 27,000 crore.   Intraday Trading Tips

According to the government's Petroleum Planning and Analysis Cell, under recovery on kerosene with effect from December 1 will be Rs 10.51 a litre, as against Rs 12.25 a litre in the first fortnight of October and Rs 12 in the second. Cash transfer to the customer under Direct Benefits Transfer of LPG (DBTL) will be Rs 151.29 a cylinder, of which Rs 123.17 will be cash compensation by government and Rs 28.12 by the oil marketing companies (OMCs).

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