New Delhi, March 30 -- Despite the government's recent move to cut excise duty on petrol and diesel, oil marketing companies (OMCs) may continue to face negative marketing margins, as rising crude oil prices and controlled retail fuel rates offset the benefits of the tax relief, according to a report by Nomura.

The government on March 27, announced a reduction of Rs 10 per litre in excise duty on both petrol and diesel to ease pressure on OMCs. However, the report noted that the relief may not be sufficient to restore profitability in fuel retailing.

"We estimate that marketing margins for OMCs may continue to be negative despite the excise duty cuts," Nomura said, highlighting that the primary reason remains the sharp increase in crude...