Consumers should brace for higher petrol and diesel prices. The government is likely to allow state-owned oil marketing firms?Indian Oil, Bharat Petroleum and Hindustan Petroleum–to increase the price of both fuels by up to Rs 2 a litre in the backdrop of international crude surging new peaks of $96 a barrel. Simultaneously, a mid-term correction in oil duties is also likely to prevent too a steep a hike at the pump.
Petroleum minister Murli Deora met the UPA chairperson Sonia Gandhi and Prime Minister Manmohan Singh on Friday and briefed them about the oil price situation. ?We will do all that is possible to protect the interests of our PSUs. I have posed all options before the PM. A decision may take two or three days,? he told reporters after his meeting with Singh.
Deora, however, did not rule out the possibility of a price hike. Asked to comment on whether the government was still trying to avert a fuel price increase, Deora said, ?I cannot say that, as I could not discuss the issue at length (with the PM) due to a paucity of time and a separate meeting may have to be convened next week to discuss the matter.? he said.
That?s a marked departure from October 11, when the Cabinet categorically decided not to raise the price of petrol, diesel or kerosene and opted share the Rs 54,935 crore burden with the oil PSUs. The Indian crude basket then averaged around $69 a barrel. However, the basket is now at over $85 a barrel, deepening the revenue loss of Indian Oil, Bharat Petroleum and Hindustan Petroleum by nearly Rs 7,000 crore.
The state-run firms currently incur a loss of Rs 240 crore every day on the sale of petrol, diesel, cooking gas and PDS kerosene. Deora said the situation on the ground had undergone drastic change since October 11. ?Crude oil prices have gone up so much… they have put enormous burden on our PSUs. It?s our duty to protect their interests and we will do all that is possible,? he said.