Indian Oil Q2 results showed a sharp return to profit for India’s largest fuel retailer. Indian Oil Corporation (IOCL) reported consolidated net profit of INR225bn ($2.37bn) for July-September 2026, the second quarter of the 2026-27 financial year. That was 175% higher than the INR81.9bn ($864mn) of a year earlier. The state-run company filed the results on Friday 30 October 2026.
On a standalone basis, profit was INR216.3bn ($2.28bn). That reversed a loss of INR26.6bn ($281mn) in the April-June 2026 quarter. Meanwhile, consolidated revenue from operations rose 30% to INR2.68tn ($28.3bn).
What drove the Indian Oil Q2 results
IOCL said the jump came largely from a “temporary decline in crude oil prices from mid-June to mid-August”. In addition, it pointed to “robust margins” from petrochemicals and gas. Moneycontrol also noted healthy marketing margins after the government’s cumulative INR7 ($0.07) rise in retail fuel prices in May 2026.
Standalone profit before tax reached INR266.2bn ($2.81bn), against a loss in the previous quarter. However, IOCL did not report its gross refining margins for the quarter or the half-year, BusinessLine reported.
LPG losses keep piling up
Still, the Indian Oil Q2 results reveal heavy losses on cooking gas. IOCL said its under-recoveries on domestic LPG reached INR325bn ($3.43bn) as of 30 September 2026. That is the gap between the cost of LPG and the regulated price at which it sells.
The figure remains high even after government compensation. Indeed, IOCL recognised INR72.4bn ($764mn) of that support as revenue during the six months, according to Business Standard.
Indian Oil Q2 results: refineries run above capacity
Operationally, IOCL’s refineries processed 37.273mn tonnes of crude in the first half of 2026-27. That was up 3% on a year earlier and equal to 105.8% of capacity. Similarly, its cross-country pipelines carried 53.896mn tonnes, up 7%.
Total sales rose 2% to 51.439mn tonnes in the half-year. Furthermore, IOCL’s domestic market share climbed to 42.7%, from 41.5%. Petrol sales rose 9% and diesel 8%. In the quarter alone, domestic sales reached 23.977mn tonnes. In contrast, exports fell to 1.251mn tonnes, from 1.411mn tonnes.
Warning on the months ahead
IOCL cautioned that the strong quarter may not last. It warned that inventory losses could hurt profits in coming quarters, if crude prices fall as the situation in West Asia returns to normal.
In other words, a peace deal that pulls crude prices down would cut the value of its stocks. For now, though, crude is rising again. Our latest report on Brent crude hitting a six-month high shows the pressure on import costs.
What it means for India
The Indian Oil Q2 results ease pressure on the government to compensate state fuel retailers. Even so, rising crude since mid-August 2026 squeezes margins on petrol, diesel and LPG again. As a result, the October-December 2026 quarter could look weaker.
What comes next
Next, investors will watch results from fellow state retailers and any further LPG compensation from the government. They will also track whether pump prices change if crude stays high.
For a deeper analysis, read: Indian Oil’s LPG Under-Recoveries: Why a Near-Tripled Profit Still Leaves INR325bn ($3.43bn) Unpaid
Sources
- The Hindu BusinessLine: Indian Oil’s Q2 FY27 profit surges to ₹22,503 crore
- Moneycontrol: IOC’s Q2 consolidated net profit rises 175% YoY to Rs 22,503 crore
- The Tribune (ANI): IndianOil returns to profit in Q2 with Rs 21,630 crore earnings
- Business Standard: Indian Oil posts 174% increase in net profit amid high refining margins
- News18 (PTI): Rupee jumps 50 paise to close at 94.76 against US dollar
