The current low phase of international oil prices has helped many companies in the transport and associated sectors to gain advantage. The ailing Kerala State Road Transport Corporation (KSRTC) has also derived some benefits, helping it look towards an improved scale of performance by reducing cost on account of fuel.
The reduction in diesel prices has resulted in a gain of almost Rs.25 lakh daily in terms of fuel bill, a senior official of the KSRTC told The Hindu . It would mean that the Corporation could save about Rs.7.5 crore per month in terms of cost incurred on fuel.
The phenomenon has helped the company reduce the revenue gap which has been a matter of much concern, the official said. The company is faced with a revenue gap of Rs.105 crore per month now.
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Nevertheless, the public transport company is passing on part of the gain to the student community by extending subsidy to the tune of Rs.4 lakh per day, taking the monthly spending on the count at Rs.1.25 crore, the official said. Crude oil price averaged $105.52 per barrel during financial year 2013-14 compared to $107.97 per barrel in the previous fiscal, as per statistics available from the ONGC.
The international crude oil price of the Indian basket has averaged above $110 a barrel in the current financial year (till June 2014).
The prices are quoted below $50 now.
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The ongoing trend in international crude prices has been partially attributed to an increase in shale gas output in countries such as the U.S.