NEW DELHI, India: India’s state-owned Bharat Petroleum Corporation Limited (BPCL) reported a 22.5 per cent decline in quarterly profit on Friday as rising global crude oil prices increased operating costs and squeezed fuel marketing margins.
The country’s third-largest oil refiner by capacity posted a standalone net profit of 49.93 billion rupees ($525.9 million) for the quarter ended September 30, compared with 64.42 billion rupees during the same period last year, according to Reuters.
The decline came as average global Brent crude oil prices rose approximately 40 per cent during the September quarter, driven by persistent tensions in the Middle East that disrupted energy supplies.
Higher costs pressure earnings
BPCL’s total expenses increased 32.8 per cent to 1.52 trillion rupees during the quarter, reflecting the impact of higher crude oil prices.
The cost of raw materials consumed rose 44.2 per cent, adding further pressure to the company’s profitability.
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Higher crude prices typically reduce fuel marketing margins when the cost of purchasing and processing oil rises faster than revenue from petrol and diesel sales.
The resulting pressure on retail fuel operations contributed to BPCL’s weaker quarterly earnings.
The results highlight the challenges facing Indian oil refiners as global energy market volatility increases input costs and affects profitability.
BPCL remains a major supplier of petroleum products in India, with its earnings influenced by international crude prices and domestic fuel marketing conditions.
