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Crude may trade near $100/bbl in medium to long-term: ONGC

Oil marketing companies have come into favour ever since the government signaled its intension to switch to market-linked soon, helped by a softening of global crude oil prices.

Aloke Kumar Banerjee, Director of Finance at  ONGC believes switching to market-driven prices will be a big positive. He expects crude prices to remain around the USD 100 per barrel mark, unless there is an untoward surprise.

Oil marketing companies have come into favour ever since the government signaled its intension to switch to market-linked soon, helped by a softening of global crude oil prices.

“The decision of the government, which stands today, is reduction in diesel subsidy by 50 paise per month, which means, increase in prices by 50 paise. So, the logical conclusion is that as and when that is over, it will become market driven,” Finance secretary Arvind Mayaram said at an event organised by industry body Assocham.

The Indian government, which used to force oil companies to sell automotive fuels steeply below cost, last year gave them the freedom to price petrol at a profit while initiating a 50-paisa monthly hike for diesel till prices reached breakeven – under pressure to cut its yearly Rs 65,000 crore fuel subsidy bill.

Also Read: Crude below $ 100/bbl may hasten diesel price decontrol

ONGC stock price

On August 22, 2014, at 11:30 hrs Oil and Natural Gas Corporation was quoting at Rs 431.50, up Rs 5.50, or 1.29 percent. The 52-week high of the share was Rs 472.00 and the 52-week low was Rs 234.40.


The company’s trailing 12-month (TTM) EPS was at Rs 26.72 per share as per the quarter ended June 2014. The stock’s price-to-earnings (P/E) ratio was 16.15. The latest book value of the company is Rs 171.29 per share. At current value, the price-to-book value of the company is 2.52.

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