The public sector oil marketing companies (OMCs) have said that they do not look for any direct gains from the Reserve Bank of India’s foreign exchange swap window. Such window was announced by RBI on August 28. The RBI announced the window to meet their daily dollar requirements to import crude oil. But the oil companies agreed the apex bank’s measure would bring down rupee’s volatility.
The central bank opened a dollar window for the three oil marketing companies (OMCs) — IndianOil Corporation (IOC), Hindustan Petroleum Corporation (HPCL) and Bharat Petroleum Corporation — who are the biggest dollar buyers. The OMCs require $110 billion on an annual basis for imports of crude oil, while on a daily basis, they purchase $300-500 million, say media reports.
The RBI’s measure had an immediate impact on the market, with the rupee posting its biggest single-day gain since 1998, to 66.59 a dollar on August 29.
Oil companies executives said the move would not have any financial impact on the companies except some minor relief at the under-recovery level. RBI had opened a similar window for OMCs in 2008, when international crude oil prices crossed the $140-a-barrel mark but experts believe the situation today is different, since the rupee was in a more stable terrain of 40s versus the dollar then.
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