The windfall taxes imposed by the government on domestic crude oil production and fuel exports will hit ONGC's earnings severely while shaving off up to $12 per barrel in refining margins for Reliance Industries Ltd.
India will only withdraw its windfall tax introduced last week for oil producers and refiners if global prices of crude fall as much as $40 a barrel from present levels, Revenue Secretary Tarun Bajaj told Reuters on Monday.
The windfall tax on oil produced within India and fuel exported overseas will make up for more than three-fourths of the revenue that the government lost when it cut excise duty on petrol and diesel to cool soaring inflation, industry sources said.