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Run-up to the Budget: Refining industry
Refining: State of the industry (2000-01)
- Consumption growth of petroleum products is expected to be lower at 2.7 per cent, as compared with that in 1999-2000, due to an expected slow-down in the manufacturing sector. Consumption of diesel, which accounts for 41 per cent of the total consumption of petroleum products, is expected to decline by 1 per cent. Consumption is expected to decline due to an expected decline of around 13 per in the sales of commercial vehicles in 2000-01.
- Supply of petroleum products is expected to increase by 24 per cent, as RPL's refinery at Jamnagar is expected to operate at nearly 100 per cent capacity.
- On September 30, 2000, prices of controlled products were increased. On November 21, 2000, prices of two of the controlled products (LPG and SKO) were partially rolled back.
- Margins of refineries are expected to increase as compared with those in 1999-2000. Margins are expected to increase as the increase in the product prices would be higher as compared with those of crude oil prices.
Refining: Expected regulatory changes
In 2000-01, ATF, one of the 5 controlled products, is expected to be decontrolled.
Refining: Industry expectations from the Union Budget (2001-02)
- Removal of exemption of SACD: The Confederation of Indian Industry (CII) has asked for the removal of the exemption of the 4 per cent Special Additional Customs Duty (SACD) on project imports for refineries.
- Infrastructure status for refineries: The Ministry of Petroleum has asked for an infrastructure status for refineries.
- Imposition of a customs duty on naphtha: The Ministry of Petroleum has asked for the imposition of the highest slab of customs duty on naphtha for non-power and non-fertiliser consumers.
Crude oil and petroleum products: Aggregate
| ('000 tonnes)
|
1999-2000 E |
2000-01 E |
Change (%) |
| Crude Oil |
|
|
|
| Production |
31,949 |
32,422 |
1.5 |
| - ONGC |
24,648 |
25,116 |
1.9 |
| - OIL |
3283 |
3308 |
0.7 |
| Private/JVCs |
4018 |
4019 |
0.0 |
| Imports |
44,989 |
44,754 |
-0.5 |
| Consumption |
85,964 |
102,192 |
18.9 |
| Petroleum products |
|
|
|
| Refining capacity |
112,000 |
112,000 |
0 |
| Production |
83,226 |
103,287 |
24.1 |
| Imports |
13,067 |
4,408 |
-66.3 |
| Consumption |
96,290 |
98,917 |
2.7 |
E: Estimate
JVCs: Joint venture companies
Notes
1) Consumption of crude oil is in terms of refinery throughput.
2) Import figures of petroleum products do not include imports by private parties.
3) Crude oil production figures include production of condensate.
Source: MoPNG and industry
Disclaimer: CRISIL has taken due care and caution in compiling this report. Information has been obtained by CRISIL from sources which it considers reliable. However, CRISIL does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. CRISIL is also not responsible for any errors in transmission and especially states that it has no financial liability whatsoever to the subscribers/ users/ transmitters/ distributors of its web site.
Rediff-CRISIL Budget Impact Analysis
Budget 2001
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