Outlook on power, oil & gas and telecom sector for 2007

International crude oil prices have softened considerably from peak levels. This trend is believed to continue, though with temporary spikes stemming from geopolitical uncertainty and weather-related demand. Domestic upstream companies will continue to benefit from the higher than historical crude oil prices though the gains would be moderated by GoI’s sharing mechanism – under which pubic sector upstream companies have to share the losses (under-recoveries) suffered by oil marketing companies (OMCs). Under-recoveries result from government-imposed price caps on certain fuels.

financialexpress