The short
- Brent: ~$65.8/bbl this morning after rebounding from multi-month lows.
- USD/INR: ~88.7–88.8; rangebound into global data.
- Price actions: ATF up ~3.3% m/m (Oct 1 reset); commercial LPG +₹15.5/cyl; retail petrol/diesel unchanged.
Why Brent × INR matters for OMCs
Retail petrol/diesel marketing margins are driven by product cracks + Brent converted at USD/INR, net of duties, freight, and dealer commissions. Refining GRMs can offset weak marketing, but retail optics drive near-term P&L sentiment.
OMC margin sensitivity (illustrative)
| Brent ($/bbl) | USD/INR | Illustrative retail marketing margin (₹/L) | Read-through |
|---|---|---|---|
| 62 | 87.5 | +2.5 to +3.5 | Comfortable band; scope to hold prices |
| 66 | 88.5 | +1.0 to +2.0 | Base case near today’s setup |
| 70 | 89.0 | –0.5 to +0.5 | Margins tight; GRMs/discounting matter |
| 74 | 90.0 | –1.5 to –0.5 | Under-recovery risk unless retail bands move |
Household fuel-bill planner (illustrative)
- Two-wheeler city use: 500 km/month @ 45 km/L; a ₹1/L change ≈ ₹11/month.
- Hatchback commute: 1,000 km/month @ 16 km/L; a ₹1/L change ≈ ₹62/month.
- Small business (genset 10 L/week): a ₹1/L change ≈ ₹40/month.
Operator watch-list
- Airlines: ATF +3.3% adds cost pressure; fare discipline and load factors key.
- Hotels/Restaurants: commercial LPG +₹15.5; plan menu repricing cadence.
- OMCs: Track Brent and USD/INR daily; balance refining vs marketing exposure; refine hedge tenors.
Near-term swing factors
- Geopolitical news and sanction regimes affecting seaborne flows.
- OPEC+ supply signals into November.
- US inventory prints and global demand indicators.