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Bloomberg
Stay-at-home orders across the world drove India’s most profitable oil refiner’s net income down 39%.
Reliance Industries’s earnings slumped in the three months through March as lockdowns slammed oil prices and destroyed demand for fuels, hitting its mainstay refining business. The oil-to-chemicals business posted the biggest profit drop in nearly two decades, and prompted its chairman and Asia’s richest man, Mukesh Ambani, to forgo his pay and cut salaries of employees.
The industry’s woes may deepen. The historic collapse in the price of oil triggered by the coronavirus pandemic is devastating the energy industry with the biggest companies from China to the US reporting big drops in profit and growing financial stress amid the worst global slump since the Great Depression. Asia’s biggest refiner Sinopec swung to a loss, while BP reported a drop in profit and Exxon Mobil has frozen its dividend for the first time in 13 years.
The volatility in oil prices, which declined 73% during the quarter, and perishing demand eroded the value of the crude and oil products it keeps in stock, resulting in a rare inventory loss of 42.45 billion rupees, according to Reliance. India’s biggest company by market value is known for its agility is oil trading that shields it against losses from price swings.