India's IOC posts almost sevenfold jump in Q2 refining margin

New Delhi — State-run Indian Oil Corp. reported almost a sevenfold jump in its fiscal Q2 refining margin to $8.62/b on the year as India's No. 1 state-run refiner took advantage of low-priced crude bought in the previous quarter.

The increase for the July to September period came despite a 20.3% drop in throughput on the year to 14 million mt, according to a statement issued Oct. 30. Its pipeline throughput dropped 20.2% to 17.3 million mt and its domestic sales were 12.3% lower on the year 17.7 million mt due to lockdown as authorities sought to combat the spread of COVID-19. India, Asia's second-biggest oil consumer, observed a national lockdown starting March 25 and began easing in June after medical facilities were prepared for infected patients.

The increase in the gross refining margin was due to inventory gains derived by processing crude purchased at lower prices during Q1 (April-June), IOC Chairman Shrikant Madhav Vaidya told reporters after the company's Oct. 30 board meeting. Exports for the three months fell 3.2% in the year to 1.2 million mt.

For the half-year period from April to September, IOC's gross refining margins rose 16.9% from a year earlier to $3.46/b mainly on inventory gains in Q2. Its crude throughput fell 22.7% year on year to 26.9 million mt while pipeline throughput dropped 25.8% yo 32.4 million mt. Sales fell 21% to 32.9 million mt and exports rose 4.7% to 2.5 million mt.