Oil marketing firms on slippery ground

Oil marketing companies may suffer a bear hug as crude oil prices are on the boil. Rates have climbed to a nine-month high. Brent crude posted its fourth consecutive weekly gain and US crude rose for the third consecutive day, ending at the highest level in nine months. US crude for March delivery settled at $103.24 a barrel. In London, ICE Brent crude for April delivery settled at $119.58 a barrel, after hitting a session-high of $120.70, the highest since June 15. All these paint a negative picture for oil market companies such as BPCL, HPCL and Indian Oil Corporation, because they have to bear the cost price. With the crucial Uttar Pradesh assembly election under way, it is unlikely that the Union Government will allow these companies to increase the price.