Moody's: Indian Fuel Retailers Under Pressure from Margin and Cash Flow Issues
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Moody's: Indian Fuel Retailers Face Margin, Cash-Flow Pressure Amid High Global Prices
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News18•11-03-2026, 15:15
Moody's: Indian Fuel Retailers Face Margin, Cash-Flow Pressure Amid High Global Prices
•State-owned fuel retailers Indian Oil Corporation (IOC), Bharat Petroleum Corporation Ltd (BPCL), and Hindustan Petroleum Corporation Ltd (HPCL) absorb high global energy prices, leading to margin and cash-flow volatility.
•Domestic retail fuel prices have remained largely steady since April 2022 despite global swings, due to government influence preventing timely cost pass-throughs.
•OMCs, controlling nearly 90% of retail outlets, bear rising input costs without corresponding selling price increases, compressing marketing margins and weakening operating cash flows.
•India's high dependence on imported oil (88%) and gas (51%) exposes OMCs to global price movements, impacting their cost base and earnings.
•LPG prices were raised on March 7; OMCs expect losses from selling below market prices, but government approved Rs 30,000 crore compensation for past losses, to be disbursed monthly.
