State-run Indian Oil Corp. (IOC) on Friday reported a net profit of Rs 13,750 crore in the in April-June quarter (Q1), the highest in a decade, as margins on petrol and diesel turned positive on softer oil prices. IOC's standalone net profit of Rs 13,750.44 crore, or Rs 9.98 per share, in the the first quarter of the current fiscal year compared with a loss of Rs 1,992.53 crore in the same period a year ago, according to a company's stock exchange filing.


IOC logged a profit of nearly 37 per cent higher than Rs 10,058.69 crore net profit in the preceding quarter and more than half of the company's best-ever annual earning of Rs 24,184.10 crore recorded in 2021-22 (April 2021 to March 2022). The OMC clocked a net profit of Rs 14,513 crore in January-March 2013 after it received fuel subsidy for more than one quarter during those three months.


Last year, IOC and other government-owned fuel retailers, Bharat Petroleum Corporation Ltd (BPCL) and Hindustan Petroleum Corporation Ltd (HPCL), froze retail petrol and diesel prices to cushion domestic consumers from rising international oil rates. That freeze led to the three retailers suffering heavy losses in not just April-June 2022 but also in the subsequent quarter.


Margins on petrol and diesel turned positive following softening of international oil prices in the June quarter, but rates were not revised, and the companies recouped losses they incurred last year.


The fall in oil prices meant that revenue from operations for IOC fell 2.36 per cent to Rs 2.21 lakh crore. Operational performance during the quarter improved as earnings before interest, taxes, depreciation and amortization (EBITDA) increased 44.5 per cent to Rs 22,163 crore from Rs 15,340 crore, sequentially.


The company earned $8.34 on turning every barrel of crude oil into fuel during the quarter ended June 30 against a gross refining margin (GRM) of $31.81 per barrel in the same period last year, the filing said. Core GRM or the current price GRM for the period April-June 2023 after offsetting inventory loss/gain came to $9.05 per barrel.


IOC said fuel sales rose to 21.8 million tonnes in the first quarter from 21.2 million tonnes a year back. Its refineries processed 18.26 million tonnes of crude oil, up from 17.59 million tonnes in April-June 2022.


BPCL earlier this week reported a net profit of Rs 10,644 crore in the June quarter. HPCL is due to announce its first-quarter earnings next week.


IOC, BPCL, and HPCL temporarily abandoned the daily price revision last year and have not revised petrol and diesel prices in line with the cost. And the losses they incurred when the oil prices were higher than the retail selling prices are recouped with rates dropped. The three firms have been making positive margins on petrol since the fourth quarter of the 2022 calendar year but diesel, which accounts for the bulk of the fuel sales, had been in the red. But in May, margins on diesel turned positive with a small 50 paise a litre profit. International oil prices had spiked to $139 per barrel in March 2022 in the aftermath of the Russia-Ukraine war. They cooled to $75 during May-June.


Shares of IOCL closed at Rs  95.28 apiece, down 0.33 per cent, on the BSE on Friday.