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Upstream firm Oil India reported on Tuesday a higher after-tax profit for the quarter ending June 30 compared to the same period last year due to lower costs offsetting a decline in revenues which fell amid lower oil and gas prices.
Oil India’s profit for the first quarter of the 2023/2024 fiscal year increased by 4% year over year and stood at $194.6 million (16.13 billion Indian rupees). That was due to a decline of 26.5% in total expenditure, which more than offset the drop in revenues of 22%.
The realized crude oil prices for Oil India averaged $74.26 per barrel for the April-June quarter, compared to the $112.73 per barrel average crude oil price realizations for the same quarter of 2022.
Quarter-on-quarter, Oil India’s earnings dropped by almost 10% after the government cut the natural gas prices in April to help buyers of gas for the industry and city distributors.
Meanwhile, India’s largest coal producer also reported earnings on Tuesday. Coal India booked a 10% decline in consolidated net profit for the April-June quarter, but the earnings beat an analyst poll. Revenues, also above expectations, increased by 2%.
Coal demand in India and in the world is set to grow.
Driven by robust growth in coal consumption in Asia, global coal demand this year will remain at the record-high levels hit in 2022, the International Energy Agency (IEA) said in a report last month.
Last year, global coal demand increased by 3.3% to 8.3 billion tons—a new record-high, the agency said in its Coal Market Update.
This year, coal demand will inch up by 0.4% year-on-year, to 8.388 billion tons, due to continued growth in industrial coal use which would offset an expected small decline in coal-fired power generation, according to the IEA estimates.
“Whether coal demand in 2023 grows or declines, will depend on weather conditions and on the economies of large coal-consuming nations,” the agency noted.
By Charles Kennedy for Oilprice.com
Charles is a writer for Oilprice.com