Left opposes oil price hike

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New Delhi, May 16: Left parties on Monday opposed any increase in petrol and diesel prices in step with the hike in global oil prices and higher taxes. They asked the government to restructure duties to protect consumers.

The Left parties, which had an hour-long meeting with finance minister P Chidambaram and petroleum minister Mani Shankar Aiyar, demanded a roll back in excise duty increase announced in the Budget, shelving of the proposal to raise road cess and creation of price stabilisation fund out of the cess collected on domestic crude oil.

Mr Aiyar said, "We have listened very carefully to a very detailed presentation from the Left. The finance minister has agreed to carefully examine the points raised by them."

Petrol prices need to be raised by Rs 4.59 a litre, half of it (Rs 2.52) on account of increase in excise duty. Similarly, diesel prices need to be hiked by Rs 4.97 per litre, including Rs 1.53 due to excise effect. The required increase also includes Re 0.61 per litre each due to hike in road cess.

"We have asked the government not to increase prices but consider other ways (of containing the impact of global spike)," CPI secretary D Raja told reporters.

CPI(M) member of Parliament Dipankar Mukherjee said the finance minister’s statement, while presenting the Budget that the duty changes were revenue neutral and would not result in any increase in retail price, was ‘false’. "It is felt the proposed changes in duty structure have actually helped the stand alone private refineries, specially Reliance, while hitting the public sector oil companies," he said.

"Import duty reduction has helped the refining sector, but the excise duty changes, applicable after refining, affect adversely the marketing/retail sector managed by the oil PSUs," he added.

Public sector oil retailing firms have lost over Rs 5,800 crore in the first six weeks of the current fiscal due to non-revision of petrol, diesel, LPG and kerosene prices in

line with the spurt in international oil prices and increase in duties.

Indian Oil Corp, BPCL and HPCL together lost Rs 2,560 crore on diesel and Rs 569 crore on petrol. The Budget had lowered customs duty on crude oil, LPG, kerosene, petrol and diesel but raised excise duty on petrol and diesel even as the same on LPG and kerosene was lowered.