NEW DELHI: State-owned Indian Oil Corp (IOC) saved over Rs 1,000 crore last fiscal after the government gave state-owned refiners the freedom to formulate their own crude import policies.
IOC Chairman B Ashok said the freedom allowed the companies to decide on tenders for purchase of crude oil within a very short span of time. “Earlier we used to take 36 hours to formalise a tender. This time was considered too much considering crude oil prices change every minute. This time has now been brought down to less than two hours,” he told reporters here.
The flexibility given in April last year allowed companies to decide on buying crude oil from spot or current market on their own instead of previous practice of a committee comprising company officials and a representative of the Oil Ministry deciding that. The flexibility has led to oil companies shifting from traditional term or fixed tenure buying to spot purchases.
“Term crude volumes used to be as high as 80 per cent (of all the crude oil imported). We have brought it down to 68 per cent,” he said. This flexibility has allowed oil companies to quickly finalise any crude oil available in the international market at an economical price.