India ONGC margins seen at $110/bbl in April-May-paper

MUMBAI, May 17 (Reuters) - India's top oil explorer, Oil and Natural Gas Corp (ONGC) (ONGC.BO: Quote, Profile, Research) expects gross billing margins at $110 per barrel in April-May, its top executive told the Business Standard in an interview published on Saturday.

ONGC's billing margins were $100 per barrel in the quarter ending March, R.S. Sharma, chairman and managing director at the state-run firm told the financial daily.

The total cost of selling crude oil at discounted prices to state refiners for the current fiscal year starting in March, would be 200 billion rupees ($4.71 billion), up from 170 billion rupees in 2007/08, he said.

ONGC's shares have fallen by nearly a fourth so far in 2008 as rising oil prices have hurt the firm's profitability.

State-run firms are required to sell oil from its domestic output at heavy discounts to state refiners since retail fuel prices are controlled by the government and set lower than global rates.

Crude oil prices have soared by a third in 2008 to a record $128 per barrel on Friday but India has raised retail fuel prices only once this year by just 3-4.6 percent in February.

ONGC's shares ended flat at 950.90 rupees on Friday in a Mumbai market that gained 0.5 percent. Financial markets are closed on Monday for a religious holiday. ($1=42.5 rupees) (Reporting by Saikat Chatterjee; Editing by Anshuman Daga)