Companies to bear rising oil price burns

MUMBAI: The spiralling crude oil prices are likely to take a toll on the margins of companies in sectors like fertiliser, textiles, pharma, automobile, tyre, paints and aviation.
In fact, a recent report by Goldman Sachs has forecast oil prices rising as high as $150 to $200 within two years. Analysts say a weak US dollar and worries about falling production in Mexico and Russia also pushed prices higher. The US investment bank had three years ago predicted that oil would break through $100. Crude oil was trading at about $122 a barrel on Wednesday.
Shahina Mukadam, head of equity research, IDBI Capital Markets, feels that rising oil prices are increasingly becoming a major concern. “While so far the direct impact has been limited, if prices retain this momentum, it could adversely impact companies. The market is in a wait and watch mode,” she said.
08/05/08 Apurv Gupta/Economic Times

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Categories: Indian Aviation- In General May 2008