The All Smiles Fuel Price Situation

 

Warning & Disclaimer: This is not a piece of investment advice or recommendation. Just a personal ‘fictional story’.

It is an unhealthy tendency to blame the political parties for all things happening around us. This prevents us from thinking of a creative solution and taking action at over level instead of waiting for the government to do something.

The zooming oil price due to the Russia-Ukraine war has now put the spotlight of the world on oil prices with governments and individuals all over the world trying to cope with them. I had realized more than 10 years ago that fuel prices are going to increase in the future, no matter which party is forming the government at the central and state level in India. High taxes on petrol and diesel in India are going to stay. The government may cut down or abolish the subsidy on petrol and diesel at any time. 

As Whatsapp was not there and I had not joined Facebook at that time, the option of cursing and ranting against the state and central government and forwarding jokes on them on social media was not available to me. 

So some solutions had to be searched that could be implemented at my personal level. There is an old English adage, ‘if you can’t beat them, join them’. So long back, I bought the shares (stocks) of Cairn India, the number one oil exploration and production company in Indian land at that time. This was later acquired by Vedanta Ltd. Sometime later I bought shares/stock of Oil and Natural Gas Corporation Limited (ONGC), the largest Public Sector company with oil refinery, exploration, and production in India and even abroad. On noting the cut in subsidy by the Indian government and allowing the oil marketing company to decide their own rates, I bought some shares of Bharat Petroleum Corporation (BPCL), and Indian Oil Corporation (IOCL), India’s leading oil marketing companies. Over the year I increased the shareholding in these companies and bought shares of other related companies.

Now if fuel prices are low, I enjoy low fuel cost and low fuel price-related inflation. When the fuel price is high, like now, the share prices of the above-mentioned companies rises, increasing my net worth, and they pay higher dividends compensating to some extent for the increased fuel expenditure. 

In this financial year, these companies had paid me dividends approximately worth three to four months of my expenditure on fuels. So head I win, tail I win and peace and smiles for me at all times.

— ND

(Based on allegedly true incident.)

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DISCLAIMER: This article is intended only for fun purposes. The author does not promote or recommend any behavior illustrated here or claim it to be useful. Use the information herein is at your one's own risk. Before trying to emulate or follow anything the reader is well advised to take into account ethical, moral, legal, and other considerations.