Oil eases below USD 124 per barrel

Singapore, May 13: World oil prices on Tuesday eased further, trading below USD 124 a barrel as a firmer dollar encouraged profit-taking in a market that remains well-supported, analysts said.

New York's main oil futures contract, light sweet crude for June delivery, was 37 cents lower at USD 123.86 from USD 124.23 at the close of trading in New York yesterday.

The benchmark contract traded lower for most of the New York session, but struck a record intraday high of USD 126.40.

Brent north sea crude for June delivery was 14 cents lower at USD 122.77 a barrel after a drop of USD 2.49 to USD 122.91 dollars yesterday.

Oil prices have more than doubled in the past year and have rocketed 25 per cent since the start of the year, when they broke the USD 100 barrier.

Analysts cite a variety of factors for the price spikes, including rising energy demand from Asian powerhouse economies China and India, a weak US dollar and OPEC's refusal to pump more crude.

Mike Fitzpatrick, an analyst at MF Global, said that with the US dollar's strengthening more recently, "it is hardly a surprise to see oil prices backing off."

A stronger greenback makes dollar-priced crude more expensive for holders of other currencies.

In Asian morning trade the euro was at USD 1.5515, down from USD 1.5542 in late nEw York trades yesterday, and from the record of USD 1.6002 reached on April 22.

Bureau Report

Vijaya Bank net profit at Rs 361cr

Mumbai, April 26: Public sector lender Vijaya bank on Saturday announced a net profit of Rs 361.28 crore for the financial year ended March 31, 2008, a growth of 9.04 percent over the corresponding period a year-ago.

The bank had a net profit of Rs 331.34 in the financial year ended March 31, 2007, it said in a filing to the Bombay Stock Exchange.

For the fiscal year ended March 31, the total income of the bank rose to Rs 4,420.57 crore, from Rs 3,087.4 crore in the year-ago period.

Shares of the bank closed at Rs 54.10, up 3.24 percent yesterday on the BSE.

Bureau Report

Effective steps to be taken to rein in inflation: FM

Chennai, April 26: Under pressure from the Opposition as well as its key allies, the government on Saturday hinted at more steps to bring down prices of essential commodities and rein in inflation.

"The union government will do the needful to check spiralling prices of essential commodities," Finance Minister P Chidambaram told reporters after his convocation address at the Women's Christian College here.

The inflation has been hovering at seven per cent for the last few weeks and a part of it has been due to rise in the prices of food items. For the week ended April 12, the rate stood at 7.33 per cent from 7.14 per cent in the previous week.

However, government measures like banning exports of non-basmati rice and making imports of edible oil cheaper, have led to softening of prices of these items.

Chidambaram also said the reservation in education for scheduled castes, scheduled tribes, backward classes and women should be viewed as an affirmative action to democratise the education system.

Observing that India's education system has been under performing at various levels, he said about 7.6 million children who ought to be in school were out of it.

To effectively strengthen the education system, the outlay for the current year under 'Sarva Shiksha Abhiyan' had been increased to Rs 13,100 crore, he said, adding that in 2008-09, two lakh teachers were expected to be appointed and another two lakh classrooms would be built.

The government, he said, would also take steps to raise the Gross Enrollment Ratio, the proportion of school-leaving children admitted to a college or university, from 11.6 per cent to 15 per cent by end of the 11th five year plan.

Bureau Report

Govt, RBI move in tandem to exorcise inflation devil

New Delhi/Mumbai, April 17: In a synchronised assault on price rise, the government and Reserve Bank on Thursday unleashed more measures, including steps to temper demand for loans, to cool inflation which incidentally eased to 7.14 per cent.

RBI announced raising CRR, the amount of funds banks are required to park with the apex bank, by half-a-per cent to eight per cent to suck out Rs 18,500 crore excess liquidity from the banking system.

While the move is expected to temper demand for loans by way of high lending rates, the government is also understood to have finalised imposition of 10 per cent duty on steel exports and 15 per cent ad-valorem duty on shipping iron ore abroad.

Steel prices, which have increased by up to 49 per cent in the last 12 months, have contributed significantly to high inflation, which has fallen marginally to 7.14 per cent for the week ended April 5 from 7.41 per cent as on March 29.

Official sources also said that the government may provide one litre of edible oil every month to the poor through the public distribution system at a discount of Rs 15 to insulate them from the price rise.

"Year-on-year wholesale price index-based inflation, which was 3.83 per cent on January 12, 2008 (at the time of announcement of RBI's third quarterly review of credit policy), increased to 7.41 per cent on march 29 and remained at 7.14 per cent as on April 5 and its overall impact on inflation expectations requires to be monitored and moderated," the Central Bank said in a release.

Official sources said that an inter-ministerial group constituted to suggest measures for containing steel prices has finalised its report and it is expected to be submitted to Prime Minister Manmohan Singh shortly.

Finance Minister P Chidambaram is believed to have approved the report.

In the report, the ministries have broadly agreed on imposing a duty of 10 per cent on export of steel, reduction of excise duty to 8 per cent from the current 14 per cent, abolishing import duty on scrap and metcoke prices and doing away with the countervailing duty.

The significant part of the recommendations is to impose a 15 per cent ad valorem duty on iron ore export.

Once the Prime Minister goes through the report, the government would convene a meeting of the Cabinet Committee on Prices (CCP) to take stock of the price situation in the country.

The last time the CCP met on March 31, it had decided to abolish import duty on crude form of edible oils, and slash duty to 7.5 per cent on refined edible oil, besides ban export of non-basmati rice.

Agriculture Minister Sharad Pawar had yesterday announced a Rs 15 per litre subsidy on edible oil to be sold through PDS, besides a decision to import one million tons of cooking medium to improve the supply situation as part of efforts to fight inflation.

The government has repeatedly described inflation as an "iniquitous tax" on the poor and has said it even was willing to forego revenue to contain prices.

Bureau Report