HPCL Posts 9 Percent Drop in Profit as Crude Prices Swing

State-owned Hindustan Petroleum Corporation Ltd posted a 9% year-on-year drop in standalone net profit to ₹3,483 crore for the second quarter. Crude oil prices saw high volatility due to the restarted conflict in West Asia.

Refining and Revenue

The Mumbai-based company saw its gross refining margin jump sharply to $32.15 per barrel in the reported quarter, compared with $8.80 per barrel in the same period last year. Revenue went up 26% year-on-year to more than ₹1.39 lakh crore.

Sales and Production

Total sales volumes, including exports, grew 5.5% to 12.73 million metric tonnes. Domestic sales went up 4.9%, while combined sales of petrol and diesel grew 10% to 7.78 million metric tonnes. The company processed 6.2 million metric tonnes of crude oil and ran its refineries at a capacity utilisation rate of 100.4%.

Context

Oil marketing companies in India buy crude oil from international markets to process into fuel for domestic use. When global crude prices change quickly due to conflicts or supply issues, it directly affects their financial results and profit margins.