New Delhi, Feb. 4 -- Oil Marketing Companies (OMCs) are likely to face near-term challenges due to multiple factors, including no budgetary support for LPG under-recovery, weak Singapore Benchmark Gross Refining Margins (GRM), and declining integrated margins on auto fuel, according to a report by Dolat Capital.

"In the near term, OMCs will remain under pressure mainly due to (1) the absence of budget support for LPG under-recovery; (2) weak Singapore Benchmark GRM at USD 2.4/bbl Q4TD vs. spot of USD 9.6/bbl; and (3) integrated margins on auto fuel at Rs8/lt vs. long term avg. of Rs11.5/lt." says the report

But the report also adds that while the absence of budgetary support for LPG under-recovery remains a concern, the government's dec...