Oil companies cheer petrol price hike on bourses

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Oil companies surged by almost 3 per cent in early trade on the BSE after petrol prices were hiked by Rs 1.82 per litre from Friday.

The country's largest fuel retailer, Indian Oil Corporation, opened on a bullish note and then rallied by 2.70 per cent to an early high of Rs 308 on the BSE.

In a similar fashion, Bharat Petroleum Corporation -- which opened at Rs 640 -- jumped by 1.53 per cent to a high of Rs 641 on the BSE.

Hindustan Petroleum Corporation opened at Rs 345 and then gathered further momentum and rose 2.08 per cent to an early high of Rs 348.40 on the BSE.

Marketmen attributed the uptrend in these companies as a knee-jerk reaction to the petrol price hike.

Following the increase, petrol will cost Rs 68.64 per litre in Delhi, up from Rs 66.64 a litre. The retail selling price in different cities will vary according to local sales tax.

This is the second hike in petrol prices in less than two months and came on a day when food inflation rose "dangerously" to 12.21 per cent for the week ended October 22.

Oil marketing companies had earlier hiked petrol prices by Rs 3.14 a litre on September 16, when the rupee was ruling at about Rs 48 per US dollar.

The government had in June last year freed petrol from price controls, but the retail rates have not moved in line with the cost as high inflation forced the oil companies to seek 'advice' from the parent Oil Ministry before revising the rates.